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Financial Ecological Environment And Corporate Financial Constraints

Posted on:2017-09-11Degree:MasterType:Thesis
Country:ChinaCandidate:Y ZhangFull Text:PDF
GTID:2359330512474705Subject:Financial management
Abstract/Summary:PDF Full Text Request
Private enterprises and other non-state-owned enterprises are becoming an important driving force to promote China's economic development,but in the Chinese special system background and economic system transformation,the financing constraints of private enterprises has not been fundamentally resolved.Especially with the bond market growing,enterprises pay more attention to and make greater use of bond financing,but the bond market has a fundamental institutional problem-government backstop for the bond,it becomes a serious impediment to the private enterprises in making use of bond in a reasonable cost.So,if the government backstop for bond market is broken,the bond default event begin to appear,what kind of impact will happen to the degree of financing constraints of A-share listed companies?Do companies with different level of financing constraints have different market reaction to bond default event?Do companies with different enterprises ownership show different reaction to bond default event?Answering these questions can help explain the financing capacity of companies influenced by the existence and the breaking of government backstop for bond market,can also provide references for the further bond market's institutional-building and method to ease the financing constraints,thus this study has important theoretical and practical value.In this paper,the objects of study are China's A-share listed companies.First of all,use SA index to measure the level of financing constraints,regard the first event of bond default as the improvement of financial ecological environment,then study the change of financing constraints of A-share listed companies after the event of bond default.Secondly,use Event Study Methodology to study the overall market reaction of China's A-share listed companies to the event of bond default,then study the differences of market reaction between different groups sorted by financing constraints and the corporate ownership,and analyze the reason for overall market reaction and for the differences of reaction;wherein,using SA index model to compute company-annual financial constraints data when establish financing constraints' group.Research on this subject can help to understand the importance of breaking the government backstop for bond market to easing companies'financing constraints objectively and empirically,also help the government to realize that the corporate ownership can influence the financing capacity.Therefore,the study of this subject is not only an important theoretical issue,but also a practical problem in the processing of China's bond market institutional reform.This paper includes six chapters.Chapter ? introduces the research background,and the purpose,the significance,the content,the methods and innovations of this article.Chapter ? Literature Reviews,reviewing literatures from three aspects,financial ecological environment,financing constraints and government background for the bond market,and identifying the point of innovations of current theory and research,then support for the contents of this paper.Chapter ? Theoretical Analysis and Hypothesizing,analyzing the reason that the breaking of government backstop for bond market can be regard as an improvement of financial ecological environment based on the financial ecological environment and its connotative definition,analyzing the impact of this improvement to financing capacity,as well as the differences between groups sorted by corporate ownership and the lever of financing constraints.Put forward hypotheses according to the theory and practical.Chapter ? Study Design,designing models based on the hypotheses.First of all,build the SA Index to study the change of financing constraints among A-share listed companies after the improvement of financial ecological environment;secondly,use event study methodology to test the reaction of A-share listed companies to the event of bond default;thirdly,use multi linear regression analysis to study the factors that influencing the cumulative abnormal returns of companies.Chapter ? Empirical Test,in the first place,test the change of bond financing behavior of A-share listed companies after the improvement of financing ecological environment;secondly,test the change of financing constraints after the improvement of financing ecological environment among the A-share listed companies;thirdly,test the reaction to the bond,default event of A-share listed companies;the last part is robustness test.Chapter ? Conclusions and Policy Recommendations,making conclusions based on theoretical analysis and empirical results,summarizing the deficiencies and making outlook for the future research.In this paper,the main conclusions are as follows:First,after the improvement of financing ecological environment,the degree of financing constraints facing of A-share listed companies decline.Second,A-share listed companies showed a significant positive market reaction to the event of bond default,which means the occurrence of bond default has positive effect to A-share listed companies,combining with the first conclusion,the decline of financing constraints leads to the significant positive cumulative abnormal return(CAR).Third,companies with higher level of financing constraints show significant greater CAR,which indicates in the occurrence of bond default,which is the improvement of financing ecological environment,companies with higher financing constraints may have greater ease of financing constraints,thus show higher CAR.Fourth,controlling the degree of financing constraints,private enterprises have higher CAR than state-owned enterprises,which indicates in the occurrence of bond default,private enterprises have greater ease of financing constraints than state-owned enterprises.The innovation of this paper is:selecting the first case of the bond default as the improvement of financing ecological environment,to study the change of financing constraints among Chinese A-share listed companies before and after the event.Using Event Study Methodology to test the reaction among Chinese A-share listed companies and the differences among different groups sorted by corporate ownership and financing constraints.Inadequacies of this article is that:Due to study the differences of financing constraints that before and after the improvement of financing ecological environment and the reaction of bond default event among A-share listed companies,the sample excluded two types,the H share companies and unlisted companies.
Keywords/Search Tags:financial ecological environment, financing constraints, government backstop for bond, enterprise property
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