The Effect Of Government Intervention On Small And Medium-sized Enterprises’ Debt Financing

The foreign researches about enterprise capital structure have been abundant.Therefore, scholars began to shift their focus to the debt financing structure, especially thedebt maturity structure, and formed relative theoretical achievements of debt financing,such as incentive and restriction effect, signal transmission effect, control transfer effect,etc. So far, scholars in China mainly study contributing factors in debt financing structureand corporate governance effect of debt financing. But very little research has beencombined with China’s national condition, enterprise ownership nature and systembackground. China has special national conditions and system background and with over30years of reform and opening-up middle and small-sized enterprises are growing fastand become a major force for national economic and social development. Moreover,domestic researches mainly focus on the helping hand and grabbing hand of governmentintervention in private enterprises or state-owned enterprises, while the research aboutmiddle and small-sized enterprises (SMEs) are not enough. In fact, the financingproblems of SMEs are becoming increasing acute, and the government strengthensattention and support to SMEs after financial crisis. Therefore, in a market environmentunder government-leading, can the financing policy set by the Chinese government andthe government interventions help SMEs to get out of financing problems, promote anddevelop during the post-crisis era?This paper selects2007-2012listed companies on SMEs board of Shenzhen StockMarket as the samples and investigates the relationship among ownership, governmentintervention and debt financing of SMEs and the effect of degree of governmentintervention on the debt financing of SMEs in the background of financial crisis. Thisstudy shows that:①in China the way of debt financing of SMEs is solitary and takesshort-term bank loan as the main. State-owned SMEs has richer ways of debt financingand longer debt financing maturity than privately-owned SMEs. But the more intense aregovernment interventions, the higher is the level of bank loan in privately-owned SMEs,especially short-term bank loan.②government intervention plays an active role in thedebt financing maturity of SMEs, which is concretely shown that the more intense aregovernment interventions, the higher is the level of long-term bank loan in SMEs.③private-owned SMEs’ operating performance and financing efficiency are not better thanstate-owned SMEs. And the government intervention can amplify the increasing of operating profit ratio and slow the decline of operating profit ratio at times of financialcrisis, which helps SMEs to improve performance.④state-owned SMEs are better thanprivate-owned SMEs in using debt financing’s corporate governance effect to improveoperational performance during the period of post financial crisis. Meanwhile comparedwith high degree of government intervention, the operating performance and financingefficiency of SMEs is better under moderate government intervention...