The Research On The Irrational Financing Decision Of Listed Corporations In China

Financing decision is an important financial behavior of corporations, which brings change in cash flows and has influence on the capital structure ,governance structure and enterprise value .Furthermore, it determines the reallocation of controlling powers and interests among stockholders , and attaches the due importance to the rights and interests of stakeholders .Rational financing decision should benefit the capital structure and the value of corporations. But some evidence show the financing decision of listed corporation in china is irrational ,finance becomes the substitute of "kijing".It has bad influence on the reputation of Chinese capital market, and most seriously destroy the base of listed corporation' development and the confidence of investors.Based on the theory of economics and behaviors ,this thesis discusses irrational financing decision of listed corporations in china .Part one, the author expatiates basic financing decision problems including the crux of financing decision and financing theory , which give theory foundation to following parts. Part two, some irrational financial decisions are analyzed in the following paragraphs with the intention of leading to the practical meaning of this research. Part three, the reasons of leading the irrational financial decision are the non-efficient of institution and lack of credit. An empirical research on the influence factors of financial decision is put in this sector. Finally, puts forward some suggestions about the improvement of institution and credit culture.The innovations of this article lie in three aspects .First, an empirical research is put in the influence sectors of financial decisions. Second, with the theories of behaviors and institutional economics, the paper studies the formation and effect of irrational financial decision in china's listed corporations, and draws a conclusion that it is the result of self-interest of decisions' controlling right owners under the common influence of inside and outside factors .Third, from the analyses of the source of irrational financial decisions , the auihor thinks it shouid include the inefficiency of "hard restriction" of institution and "soft restriction" of credit culture .