Font Size: a A A

Study On Corporate Financing Constraint For R&D Investments Of Chinese Listed Companies

Posted on:2014-01-15Degree:DoctorType:Dissertation
Country:ChinaCandidate:S H WangFull Text:PDF
GTID:1229330398486231Subject:Business Administration
Abstract/Summary:PDF Full Text Request
With the development of the globalization, the larger pressure of competition makes enterprises urgent demand for technology innovation more and more increase, and the enterprise also realized the important of the technology innovation for enterprise survive and development. The enterprise innovation ability should be based on the R&D, so, the fund that firm invested to R&D determine technology innovation ability of the firm, and also become an important indicator to measure enterprise innovation ability and technical strength.. However, the fund that the firm invests to R&D is very low in fact. Now, the Chinese scholars generally research the insufficient reason of corporate R&D investment from different angles, including principal-agent theory, corporate resources theory, upper echelons theory review and so on. Unfortunately, few people pay attention to the financing problems of the corporate R&D investment. Because the financing channel of the providing fund has an impact on corporate R&D investment, so, the financing problem of the R&D are the main factors to restricting corporate R&D investment. Although R&D plays an important role in economic growth and has a higher sensitivity to the financing, the studies are more focus on the financing constraints for physical investments, and only a few literatures pay attention to the financing problem of R&D investment.Using the panel data from2007to2011of Chinese non-financial listed companies, this paper conducts a dynamic panel GMM to study the financing constraints in R&D investment and compare the difference of R&D financing constraints in firms with different ownership and different life stage. The empirical study show there is a significant positive relationship between R&D investment and cash flow, which means there has obvious financing constraints phenomenon in R&D Investment of Chinese listed companies. Further studies show that list companies with different ownership have significant differences in the financing constraints for R&D investments, and the financing constraints for R&D investments in private listed companies are bigger than the state-owned listed companies. In addition, list companies with different life stage have significant differences in the financing constraints for R&D investments, and the financing constraints for R&D investments in mature listed companies are stronger than the state-owned listed companies.Then this paper tests the mitigation effect of corporate governance on R&D financing constraints. Among the corporate governance, this paper mainly examine whether board governance (including board size and the ration of independent directors) and institutional investors holding can relieve the financing constraints for R&D. the empirical show that The board size of Chinese listed companies do not reduce the dependence of the R&D investments on internal cash flow, which means that the improvement of the board size can not relieve the financing constraints for R&D investments. However, increasing the ratio of the independent directors can reduce the reliance of R&D investment on internal cash flow, which shows that the independent directors can significantly relieve the financing constraints for R&D investments. The results show the higher the ratio of independent directors in the listed companies, the lower the financing constraints for R&D investments. In addition, the improvement of the shareholding of institutional investors reduces the reliance of R&D investments on internal cash flow significantly, which indicates that the shareholdings of institutional investors relieve the financing constraints for R&D investments. In other words, the higher the shareholding of institutional investor holds, the lower the financing constraints for R&D investment.At last, this paper further tests the mitigation effect of financial development on R&D financing constraints. What is more, this paper also compares the impact of ownership and life stage on this mitigation effects. The results show that financial development relieves the financing constraints for R&D investments of Chinese listed companies. The companies in the areas with lower level of financial development have a higher financing constrains for R&D investment than the companies in the areas with higher level of financial development. There is a significant difference of the impact of financial development on financial constraints for R&D investments in firms with different ownership, and the financial development do reduce the financing constraints for R&D investments in private companies, but this reduction does not exists in the state-owned companies. There is a significant difference of the impact of financial development on financial constraints for R&D investments in firms with different life stage, and the financial development do reduce the financing constraints for R&D investments in young companies, but this reduction does not exist in the mature companies.
Keywords/Search Tags:R&D investments, financing constraints, corporate governance, financialdevelopment, Chinese listed companies
PDF Full Text Request
Related items