Research On The Influence Of Institutional Environment On Debt Maturity Structure

The choice of debt maturity structure which is an important part of the debt financing decision will not only affect investment and financing costs, corporate governance and liquidity risk, but also be directly related to the distribution of interests between the creditor and debtor. Foreign scholars have studied the debt maturity structure from the perspective of the enterprise’s internal microscopic features since the 1990s, and some representative theories were formed, such as the matching principle hypothesis, agency cost theory, tax hypothesis and informa-tion asymmetry hypothesis. However, financing contract signing is not only the enterprise’s own behavior, to a great extent, it would be led by the institutional environments. In fact, debt maturity structure can be regarded as an endogenous result of one social economic system in a particular development stage. Therefore, it has important theoretical significance and application value to study the effect of institutional environments on debt maturity structure.In recent years, the western academia gradually began to focus on macroeco-nomic factors affecting debt maturity structure, such as political relations, legal system, financial development level and some other institutional factors. For-eign research results provide certain significance for the study of debt maturity structure of Chinese enterprises. But most of these theories are set up on the in-stitutional environments of developed countries; and they may not be accord with the reality of our country? At present our country is in the period of economic transition, its unique institutional factors will undoubtedly affect debt maturity structure. Due to the different geographical location and resources endowmen-t, institutional environment is also different in different areas in China. This provides a good study environment for investigating the effect of institutional en-vironment on debt maturity structure. It has important practical significance for the debtors, creditors and policymakers to study debt maturity structure, under the unique institutional environment in China.By combining with theoretical analysis and econometric methods, this ar-ticle makes a deep exploration on the impact of institutional environment on debt maturity structure. In terms of theoretical research, comprehensively using of finance, game theory, contract theory, corporate finance and other economic theory. This paper introduces institutional environments based on the standard debt maturity model established by Holmstrom and Tirole (1998,2000). In the standard model, they assume that the investors’claims on liquidation values and long-term income can be fully implemented. However, the imperfect institutional environment will surely affect these two kinds of rights of investors. Therefore, this paper constructs a theoretical model under this situation and examines the influence of institutional environment on debt maturity structure, through solving the mathematical model, theoretical derivation, comparative static analysis and numerical simulation. In terms of empirical research, the impact of institutional environment on corporate debt maturity structure is verified through panel econo-metric analysis method. Where, the data is derived from Chinese listed companies and the index evaluating the institutional environment, such as marketization in-dex, government intervention index, product market competition index, financial development index, and legal environment index.The theoretical research results show that, under the assumption that the claims on liquidation values are damaged, the short-term debt and long-term debt will be increased with the improvement of institutional environment, and the relationship between debt maturity structure and institutional environment is uncertainty; under the assumption that the claims on long-term income are damaged, the specific relationship between long-term debt, short-term debt and institutional environment is related to the interval of institutional environment, and debt maturity structure will always be shortened with the improvement of institutional environment. Empirical results show that institutional environment has a significant negative effect on the debt maturity. The empirical research conclusion is consistent with the theoretical analysis under the assumption that the claims on long-term income are damaged.