The Research Of Dynamic Adjustment Of Firms’ Capital Structure

With the development of dynamics statistical methods of econometrics, the scholars start to pay attention to the dynamic adjustment of firms’ capital structure, and the dynamic capital structure theory has been proposed. The macroeconomic factors, especially the monetary policy can change the financing environment in a short order, so the effect of monetary policy on firms’ capital structure has been paid more and more attention.On the basis of reviewing and summarizing the existing research results, according to whether the asset-liability ratio below target or not, the paper analyses the mechanism of the effects that monetary policy has on firms’ capital structure and makes an empirical test of the effects that monetary policy has on the target capital structure and adjustment speed. The paper also compares the effects on large companies and small and medium companies, in which the relevant data of Ashare companies and listed companies on the small and medium-sized enterprises board from 2005 to 2013 is used, conclusions are as follows:(1) At present listed companies possess a low assetliability ratio and very high current liabilities rate in China;(2) Monetary policy cannot transmit smoothly by interest channel, as interest rate has no significant effects on target capital structure;(3) Monetary policy influences speed through credit channel, performances are as follows: The higher the loan supply grows, the faster adjustment speed the companies’ whose asset-liability ratio is below target have, but the companies’ whose asset-liability ratio is above target have slower adjustment speed; The influence of money supply on adjustment speed is opposite to the theory, when the money supply grows higher, the companies whose asset-liability ratio is below target have slower adjustment speed, but the other kind of companies have quicker adjustment speed; But interest rate doesn’t t influence adjustment speed in an apparent way.The reasons for the insignificance of interest rate’s impact on target capital structure and adjustment speed come down to three major ones:(1) In China the financing channel is narrow and the financing tools are rare;(2) The existence of the credit-rationing phenomenon;(3) Interest rate marketization is in a low degree. Therefore, based on the theoretical analysis and the empirical results, the paper puts forward a number of suggestions aimed at optimizing capital structure from two aspects: the company itself and the external environment.