The Research Review Of The Impact Of Product Market Competitive Advantage On Capital Structure

In the actual mid-1980s, Brander & Lewis start to analyze the relationship between capital structure and product market competition. After that, many scholars study the mutual relationship about them, which promote the development of this field greatly. This article is a literatural review of the impact of product market competitive advantage on capital structure. Before this, the paper reviews the literature about the influence of product market competition on capital structure. According to these representative literatures, there are three different conclusions:Positivity, Negativity and Uncertainty. After that, this paper reviews the literatures about the advantages of product market competition on capital structure. Author reviews the literature about the relationship between the capital structure and strategic resources, enterprise innovation behaviors. For the relationship between strategic resources and capital structure, mostly researchers suggest there are a negative relationship; For the relationship between strategic resources and capital structure, related literatures show three different conclusions:Positivity; Negativity and Uncertainty. For each type of view, author has cited some representative of the research literatures, and made more details.At last, Author commends the previous literatures. The author suggests that the current domestic and international researches create a crossover study of industrial organization theory and corporate finance. For corporate finance, these researches expand the field of traditional finance; provide a new perspective for the study of the capital structure. For corporate strategic, while establishing and maintaining competitive advantage of enterprise products market, it should consider the strategic effect of debts. Existing research literatures focus on the relationship among the characteristics of the capital structure, product market competitiveness and business performance. There are different research skills and even opposite conclusions, but these groundbreaking researches are undeniable. On the other hand, there are also some limitations in traditional research studies. Based on the author’s understanding, author gives several deficiencies of the existing research, especially the present researches lag behind the development of the modern RBV. For these deficiencies, author proposes research prospects, and gives a few possible future research directions. How to keep up with the pace of Resource Theory development is an important problem to be solved by subsequent scholars. It is recognized that the further study on the internal relationship between product competitive advantages and capital structure will greatly promote the development of the theory of corporate finance and industrial organization theory.