The Effects Of Marco Control On Capital Structure And Performance Of Real Estate Company:Hypothesis And Its Empirical Tests

After looking through the history of macro control policy of the real estate in China, this paper try to divide the macro control policy into the tax policy, financial policy, the land policy and the administrative restrictions policy, then analyze its influence respectively. This paper, through the use of 102 real estate listed enterprises in 2000-2013 (the old SEC classification) data, verifies the effectiveness of the four theoretical hypothesis proposed in this paper, and got the following conclusions:First, the tax policy suppressed the real estate speculation, and reduced the proportion of real estate enterprises’trade payables; the financial policy reduced the real estate enterprise’s long-term loans while increased the ratio of short-term and interest-bearing debts. It indicates that the tightening of financial policy forces the real enterprises to replace long-term debts with short-term, interest-bearing with interest-free debts. The administrative restrictions policy which imposed in 2010 increased the real estate enterprise’s uncertainty and crimped debts expansion. They show that financial policy does no good to financial risk of the real estate enterprises, instead, it will force real estate enterprises to rely more on short-term and interest-bearing debts and a large part of them from the shadow banking system. In the contrast, the tax policy and the administrative restrictions policy are more effective in reducing enterprises’interest-bearing debts and short-term debts ratio, objectively reduced financial risks facing the real estate sector.Second, the administrative restrictions policy has bigger impact on private sector and makes their short-term and interest-bearing debts reduce more sharply. It also shows that macro control policy in China is not only policy issue but also a matter of property. State-owned real estate enterprises are not sensitive to the macro control policy, which makes its effect is not good.Third, studies of this paper show that the real estate enterprise’s short-term debt and interest-bearing debt will significantly increase the performance of real estate enterprises. The empirical test results validate the No.3 hypothesis in this article, and also conforms to the free cash flow hypothesis proposed by Johnson (1986), namely, the short-term debt and interest-bearing debt can affect enterprise’s free cash flow, thus enabling real estate enterprise to improve the management efficiency and business performance.Fourth, the real estate enterprise’s property right has a significant influence on its performance. The higher state-owned shares equity ratio is, the better business performance it makes. While the influence of the largest shareholder’s equity ratio is not significant. The reasons behind this phenomenon may that the credit discrimination against private enterprises still exist in the real estate sector, which makes the state-owned real estate enterprises possess lower cost of credit, and easy to improve its business performance.