Abstract: According to the theory of the modern enterprise, equity restriction and interest control will exert obvious influence on the corporate ability to create. However, it have not yet reached consensus on research of its influential modes and effects. In some empirical researches, the linear equation is used mostly to discuss its linear influence, sometimes polynomial equation is resorted to discuss its nolinear influence. The results of the above researches are sometimes widely divergent because different models and various sample ranges are selected. Therefore, based on some linear unbalanced panel data models, a study is conducted on this topic in this paper. Different influential modes of equity restriction ratio are discussed on the corporate ability to create values: linearity and nonlinearity and corresponding model selection methods are proposed. The model proposed in this paper can solve key problems from three aspects. Firstly, the determination of influential models which equity restriction ratio and interest control will exert on the corporate ability to create values are based on the F test statistics. Secondly, the influential elements on the corporate ability to create values and the effect from those elements on the optimal equity restriction ratio can be confirmed by the extreme point of nonlinear function. Thirdly, the measurement of Period effect of the corporate ability to create values can reveal its dynamic fluctuation rule. Finally, empirical research is carried out on 6674 data samples from 214 public listed companies of A share market of China from the year of 2000 to 2011, its result reveals that the effect of equity restriction ratio on the corporate ability to create values is in a quadratic parabola nonlinear influential model and appears an inverse-U shape changing regular pattern. Moreover, the influence from some other elements will change the optimal equity restriction ratio, which provide theoretical basis to find further main influential factors of the dimensions of the optimal equity restriction ratio, and decision support to implement effective corporate governance.

Key words: the value creation ability, equity restriction ratio, an inverse-U shape curve, panel data models