Monetary Policy, Political Association And DEBT Financing

At the present stage in our country is in economic transition period,the market economy has not yet formed perfect system,state-owned enterprises in resource distribution,financing constraints,the budget constraints,as well as market access policy enjoy special care,etc.DEBT financing is one of the most important decisions for enterprises in the development and reinvestment decision.Political association can help private enterprises to obtain the scarce resources,industry control,tax incentives and resource allocation policy tilt,such as the government order,in turn,impact on DEBT financing,but the existing research less attention without political association of private enterprises how to make up for the money supply gap.Monetary policy is one of the basic tools of macro-economic control in our country,and is a key macro factor affecting the DEBT financing of private enterprises.It remains to be seen whether the volatility of monetary policy will affect the relationship between political connections and DEBT financing.This article selects 2005-2014,the Shanghai and shenzhen two city a-share private listed companies as research samples,the empirical analysis on the basis of political relations associated with DEBT financing,analysis and inspection is mainly focused on the monetary policy adjustment of the correlation.Research shows that political association helps private enterprises get more bank credit,lower the cost of credit,and without a political association of private companies in the face of the credit quota restriction,will gain more commercial credit instead of bank credit financing to make up for money supply gap;And the effect of political ties on DEBT financing is even more pronounced in the era of monetary tightening.In this paper,through combining the macroeconomic policy and microcosmic enterprise behavior,discusses the different types of enterprises in the face of the different external macroeconomic change coping mechanisms,for us to understand the diversity of enterprise response and effectiveness of macroeconomic policies have certain significance.