underinvestment problem

underinvestment problem　投资不足的问题　

An agency problem where a company refuses to invest in low-risk assets，in order to maximize their wealth at the cost of the debt holders.Low-risk projects provide more security for the firm’s debt holders，since a steady stream of cash can be generated to pay off the lenders.The safe cash flow does not generate an excess return for the shareholders.As a result，the project is rejected，despite increasing the overall value of the company.