Financing Constraints,the Process Of Market And The Sensitivity Of Investment-Cash Flow

In imperfect capital markets, due to asymmetric information, principal-agent problem and transaction costs and other factors, there are differences between the cost of capital from enterprise internal and the cost of capital from enterprise external, enterprises are faced with financing constraints, to a certain degree the investment of the enterprise will depend on their internal cash flow, and the investment shows sensitive to the enterprise's internal cash flow.At present, China is in transition economy period, the imperfect governance mechanism, the immature capital market and the high degree of uncertainty caused by the rapid development and other problems make the market system work immaturely and non-standardized. Banks' and securities markets' function of optimizing funding and resource allocation don't play full, most listed companies face serious financing constraints. Therefore, this article takes the listed the non-financial and non-real estate companies of Shanghai and Shenzhen stock A market from 2001 to 2005 as research sample, studies under the financial constraint the sensitive relationship between corporate investment and cash flow, and then examines the effect of the process of market development on the enterprises' financing constraints, and researches the different effect between the state-owned enterprises and private enterprises.The empirical studies show that:(1)Whether in all samples or sample groups, the financing constraints is proportional to the investment-cash flow sensitivity coefficient, enterprises that appear more financially constrained exhibit significantly greater sensitivities than enterprises that appear less financially constrained, this conclusion is consistent with the results of FHP(1988). (2)With the same classification, the state-owned listed companies own lower investment-cash flow sensitivity than private listed companies, that is to say, our state-owned listed companies are faced with more financial constraints than private listed companies. (3)In our country, the listed companies in high market region have lower investment-cash flow sensitivity coefficient than that in low market, that is to say, the listed companies in high market region are faced with less financial constraints than that in low market. (4) In the development of the process of market, the financial constraints of state-owned listed companies are relieved more than that of private listed companies, this conclusion is inconsistent with expectation, that's because the current financial constraints faced by China's enterprises are mainly affected by their own factors.