Site Visits and Corporate Investment Efficiency

• 成果类型: Article
• 署名作者: Cao, Sean Shun; Gong, Guojin; Kim, Yongtae; Shi, Hanzhong; Wang, Angie
• 署名单位: University System of Maryland; University of Maryland College Park; University of Connecticut; Santa Clara University; Korea Advanced Institute of Science & Technology (KAIST); Huazhong University of Science & Technology; Chinese University of Hong Kong
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2022.00302
• 发表日期: 2025
• 关键词: site visits; corporate investment efficiency; monitoring; information acquisition

摘要

Site visits allow visitors to physically inspect productive resources and interact with on -site employees and executives face to face. We posit that, by allowing visitors to acquire investment -related information and monitor the management team, site visits offer disciplinary benefits for corporate investments. Using mandatory disclosures of site visits in China, we find that corporate investments become more responsive to growth opportunities as the intensity of site visits increases, consistent with the notion that site visits yield disciplinary benefits. We also find that the positive association between site visits and investment efficiency is more pronounced when visitors can glean more investmentrelated information and when they have stronger incentives and greater power to monitor managers. This positive association is also stronger among firms with more severe agency problems and higher asset tangibility. The overall evidence supports the notion that site visits serve as a unique venue for institutional investors and financial analysts to acquire valuable information and serve a monitoring function, which generates disciplinary benefits for corporate investments.