Study On Financing Behavior Of State-owned Enterprises

Enterprise financing is one of the main functions of Corporate Financing. The traditional financing theory mainly discusses the relationship between financing cost and firm value. Modern financing theory finds that different behavior of enterprise financing actually reflects different contractual connection. And different contractual connection will cause different corporate governance patterns. So the modern financing theory discloses the intrinsic relation between enterprise financing and corporate governance. Modern financing theory combines the theory of corporate finance and contract. It offers us a analytic framework about enterprise financing. But it is not much enough to analysis behavior of enterprise financing only from the intrinsic contractual arrangement of enterprise. We believe that extrinsic contractual arrangement of enterprise will also influence the behavior of enterprise financing. Compare to the classic conclusions of many western scholars, financing behaviors of the state-owned enterprises in China totally deviate the classic theories. The current situation is the listed state-owned enterprises have a strong preference for the equity financing while the unlisted ones rely on the debt financing (loan from the banks).We consider that the intrinsic and extrinsic contractual arrangement such as state-owned enterprises themselves, market and law institution are both lead to special financing behaviors of state-owned enterprises.Combining some experiential data, my thesis basically uses the normative analysis to prove the financing preference of state-owned enterprises. Combining the historical analysis and logical induction, my thesis tries to explain the historical reason how the contractual arrangement form in our country. Basing on this analysis, my thesis puts forward some measures and advices to standardize the financing behavior of state-owned enterprises by making contractual arrangement perfect.