The increased equity lending supply (ELS) in the equity loan market, available for short sellers to borrow, exposes a firm to greater short selling threats. Considering short sellers' strong incentives to uncover firm-specific information and monitor managers, we hypothesize that short selling threats, proxied by ELS, enhance corporate investment efficiency. We find that ELS significantly reduces managerial tendencies to underinvest (overinvest) especially for firms prone to underinvest (overinvest). The effect of ELS on investment efficiency is stronger for firms with higher information asymmetry and weaker corporate governance, confirming short sellers' role in mitigating information and agency costs. However, short selling risk weakens the effect of ELS. Our evidence is robust to endogeneity checks and suggests that corporate investment can be driven by a particular capital market condition: the amount of lendable shares in the equity loan market.

股票贷款市场上增加的股票贷款供应（ELS）可供卖空者借入，使公司面临更大的卖空威胁。考虑到卖空者发现公司特定信息和监控经理的强烈动机，我们假设由 ELS 代理的卖空威胁提高了公司投资效率。我们发现 ELS 显着降低了投资不足（过度投资）的管理倾向，特别是对于容易投资不足（过度投资）的公司。对于信息不对称程度较高和公司治理较弱的公司，ELS 对投资效率的影响更强，证实了卖空者在降低信息和代理成本方面的作用。然而，卖空风险削弱了ELS的效果。