Monetary Policy And The Dynamic Adjustment Of Corporate Capital Structure

Unlike most previous static research in the theory of capital structure, this paperhas given a deep discussion on the corporate capital structure from the dynamicperspec-tive, the research finds thata company’s capital structure is aconstantdynamic process of being adjusted to optimum value, the capital structureadjustment speed will be affected by the integrated micro, meso and macro factors.However, the study on the dynamic adjustment of corporate capital structure from amacro point of view does not see more. In view of monetary policy as a importanttool which is used frequently to carry out macro-controlby themonetary authority, thispaper chooses monetary policy as the pointcut of discussing the relationship betweenmacroeconomic environment and the corporate capital structure dynamic adjustment.To test their relationship, this paper takes annual panel data of listedcompaniesthat only have A-shares Shanghai and Shenzhen Stock Exchangeduring2002to2012as the research object, and uses GMM estimation method in regression analysis, theempirical results show that corporate capital structure adjustment speed during theperiod of loose monetary policy than the tight period, whether the measure ofmonetary policy is substitution variable of interest rate or the money supply, but theimpact of money supply is bigger. Then this paper makes group tests according tocompany size, growth and property right based on the original model, it finds thatwhen the proxy variable of monetary policy is M2growth year on year, in the loose ortight period, corporate capital structure adjustmentspeed between different companysize and growth will change, but state-owned enterprise’s capital structure adjustmentspeed is always faster than non-state enterprise. When the proxy variable of monetarypolicy isone-year lending rate, corporate capital structure adjustment speed of largescale, low growth and state owned company are all faster than their contrary group atany stage of monetary policy. In the end, through the summarization of researchconclusions, this paper gives reference for monetary authority and micro-enterprise,also points out the shortcomings in this study and future research directions.