Earnings quality measures the informativeness of earnings numbers (a static channel) while stock market competition represents the speed of information (a dynamic channel) being distributed among smart informed traders and noisy uninformed traders. Prior research finds that both earnings quality and stock market competition mitigate information asymmetry between managers and investors (or at least mitigate the adverse effects of information asymmetry). In this paper, we investigate the impact of stock market competition on firm investment efficiency, and find that stock market competition improves investment efficiency. In addition, we also find that earnings quality and stock market competition have a complementary effect on firms' investment efficiency.