Inhibitory Effect Of Financing Constraints Of Financial Mism Atch On Over Investment

The imperfect capital market makes the enterprises in the financing, the external capital cost is higher than the internal capital costs, so that enterprises are faced with the problem of external financing constraints. However, financing and investment as the two important parts of financial management, in essence, have a close contact. When financing enterprises, facing the problem of financing constraints, it is more likely to increase its free cash flow, in order to ensure that the future can better continue to run. Since managers have the tendency to establish the business empire, there is a tendency to use the free cash flow to carry out the blind investment, and then generate over investment.. However, in view of the enterprise in the case of financing constraints, the external investors’ supervision is relatively stronger, will supervise the managers cautious investment, thus avoiding the occurrence of blind investment. Based on this, this paper finds that the financing constraints faced by enterprises can restrain over investment to some extent.An efficient capital market, is bound to be a rational allocation of resources market. At present, China’s credit scale has been ranked first in the world, the generalized currency (M2) is about 1.5 times that of the United States, is the world’s first currency issuing country. This data is quite high in comparison with the history of vertical and horizontal comparison with other countries. While the real economy departments are still generally feel the tension of liquidity, the nature of the problem lies in the financial system is irrational allocation of resources. From the perspective of the allocation of financial resources, the problem of financing constraints and investment in China’s capital market is very appropriate. Because of the common existence of financial mismatch in China’s capital market, it is bound to have an impact on the financing constraints and the excessive investment behavior of enterprises. In this paper, through the literature review found that most of the existing research on the existence of financing constraints, the impact of financing constraints, financing constraints and over investment relations. Few scholars use the financial resources to carry out the research on the financial constraint and investment behavior. In this paper, the impact of financing constraints on the over investment is from the perspective of financial mismatch. To explain the impact of financing constraints on over investment through the governance of debt financing. Based on this, this paper focuses on the governance effect of debt financing, from the perspective of financial resource allocation efficiency, the effect of restraining over investment on financing constraints is studied. It is found that the structure of the debt financing market is negative, because of the existence of financial mismatch. In the non state-owned enterprises, the role of financial mismatch mitigation financing constraints over investment is more obvious. Therefore, based on the perspective of debt financing governance, to study the financial mismatch can affect the financing constraints of the enterprise over investment, to provide new ideas and methods for the relevant theoretical research.The structure of this article is:the first part is the introduction. This paper expounds the background and significance of this research, and introduces the research contents and ideas, and the innovation points and deficiencies of this paper. Second part, literature review. Through literature review to analyze the current status of domestic and foreign research, review the financing constraints, financial mismatch literature, over investment related literature and review of the literature. In the third part, the theoretical analysis and hypothesis are put forward. In this paper, the theoretical basis of the research and the hypothesis of the paper is presented. The fourth part, the research design. The sample selection, data source and the design of the model are described in this paper. The fifth part, the empirical analysis. Through the descriptive statistics, correlation analysis and regression analysis of the data to verify the hypothesis of this paper. Sixth part, conclusions and policy recommendations. Through summarizing the research conclusion, the paper puts forward policy suggestions and the prospect of future research.This paper uses empirical research methods to 2011-2013 in Shanghai and Shenzhen A shares listing Corporation as the research object. Through the establishment of the empirical model, the paper puts forward the research on the problem of the research in this paper by means of regression analysis. Through the analysis of the empirical results, the conclusions are drawn, and the corresponding policy recommendations are put forward. In the capital market of our country, the research of this paper finds that there is a certain degree of inhibition to the over investment. In the state-owned enterprises, the financial mismatch has expanded the restraining effect of the financing constraints on the enterprises’ over investment. The expansion of the role of the debt financing market governance properties have become blurred. And in the state-owned enterprises, the higher the degree of financial mismatch is, the greater the inhibition effect of financing constraints on the over investment, the worse the governance of debt financing.The innovation point of this paper is mainly reflected in:This paper from the perspective of debt financing governance attributes, through the full consideration of the current situation of the capital market financial mismatch. To analyze the impact of the financial resources allocation of capital market on the relationship between financing constraints and investment behavior, and to provide a new perspective and theoretical explanation for the financing constraints and investment behavior. The financing constraints of this paper is to calculate and determine the financing constraints from the relevant measures of the financing constraints. This paper is not the choice of the financing constraint measurement method. This paper is from the perspective of the background of the reality of financial mismatch, the study of the inhibition effect of financing constraints on over investment, and more suitable for the research of real capital market.