Empirical Study Of The Capital Structure And Small And Medium-sized Private Enterprise’s Performance In Zhongshan

The problem of capital structure is a hot topic in nearly half a century, golden finance field enduring, the relevant theoretical and empirical literature emerge in an endless stream. Early capital structure research mainly describe the relationship between capital structure and company value or market performance, the lack of theoretical deduction and empirical test of strict. The modern capital structure theory has a strict logic, but mainly is to study the impact of tax and bankruptcy cost and other outside factors on capital structure and corporate value. After the introduction of modern capital structure theory, the research on capital fired into a new stage.25years of reform and opening up, China’s rapid economic growth at the same time, has also undergone a fundamental structure changes. State owned economy do not derived from the general competitive industries, in the private economy, the private economy has gained unprecedented development opportunities and development space, become an integral part of China the important foundation of the national economy and the socialist market economy. China’s private economy from scratch, from weak to strong, plays a more and more important role in the market economy. Chinese chief engineer of the Ministry of industry and information Zhu Hongren said at the meeting, the total number of China SMEs have accounted for more than99%of the total number of enterprises, to create the final product and service value equivalent to about60%of GDP, has played an important role in economic prosperity, promote innovation, expanding exports, increasing employment. Accounted for99%of the total number of enterprises of small and medium enterprises, provides80%of the country’s urban jobs, tax revenue is about50%of the total national revenue. This fully shows that, without a stable and rapid development of large capacity and a wide range of small and medium-sized enterprises, there is no steady and rapid development of the entire national economy. In addition, Zhu Hongren also said, at present, more than65%of the Chinese invention patent,75%of enterprises technology innovation, more than80%of new product development, is done by small and medium-sized enterprises, and to small and medium-sized enterprises as the representative of the non-public economy in the China economic and social development in the status enhancement. Small and medium-sized private enterprises based on such an important position, it also has important significance to study this subject. Under the above background, this paper takes Zhongshan city of small and medium-sized enterprises as the research object, the empirical research on the relationship between the capital structure and corporate performance. In this paper, the capital structure and corporate performance related theory as a foundation, firstly, the status and the relationship between capital structure and corporate performance of small and medium enterprises in Zhongshan City, the theoretical analysis, on this basis, using the empirical analysis of econometrics, the small and medium-sized enterprise capital structure and corporate performance: the study of the relationship between the principal component analysis method construction of small and medium-sized enterprises, the comprehensive index of performance evaluation, from the profit ability, operation ability, fully reflect the company’s performance is really level; then, through regression analysis, to find out the correlation between debt to asset ratio, current liabilities ratio and other factors of capital structure and corporate performance. The empirical analysis of the conclusion is: the performance is negatively related to the rate of assets and liabilities and corporate performance, companies with debt to asset ratio decreases. Performance is negatively related to current liabilities ratio and the company performance, company with liabilities rate decreases. Finally, according to the basic conclusions of empirical analysis, is given to improve the external financing environment, optimize the internal governance structure of small and medium sized enterprises suggestion, expect to improve the performance of the companies through perfecting capital structure.