The Influence Of Corporate Political Connections On Financing Capability

At present,most of the enterprises in our country are difficult to develop and survive.A country life of the enterprise is not only about the economy,but also related to employment,must not let down.Many scholars believe that financing is the key problem of the development of Chinese enterprises.In this paper,we will study the impact of the credit financing of private small and medium sized enterprises from the perspective of political relevance.This paper starts from the theory of social capital and credit signal theory respectively and analyzing the mechanism of political connection affect the financing ability of small and medium-sized private enterprises in China,followed by 2011 China's small and medium-sized private listed company financial data and chairman of political association-2014 data,studied the effect of political association of private SMEs to finance its credit.The empirical study shows that the political connection of private enterprises,the chairman of working in government departments,the chairman has worked in state-owned enterprises,chairman of the former or current deputies or CPPCC members three political association index have positive significant influence on credit financing ability.Moreover,the political connection of private small and medium-sized enterprises has a significant positive impact on its long-term loan capacity,but has no significant effect on its short-term loan capacity.Then,through the robustness test,it is proved that when the different variables are used as the proxy variables of the political connections of the small and medium sized enterprises,the test results of the main variables are basically stable.It shows that the results of this paper are universal.Then,based on the above analysis,the influence on the performance of small and medium-sized private enterprises financing ability based on political association,found that the effect is not significant,can not be tested,that have an impact on the performance of small and medium-sized private enterprises is not based on political association financing ability.This paper is divided into five parts: the first part is the introduction,through previous research on corporate political association on the financing of the research literature,the emphasis of the paper is induced,the points of innovation;the second part is the literature review,the literature to clarify the influence to the political connection from the connotation,the political connection paths on the size of loans with the maturity and the degree of difficulty,and on the basis of the existing literature,highlighting the innovations of this paper;the third part is to analysis the mechanism,from the social capital theory and political association signal theory to analyze the mechanism of political connection influence financing capacity of private enterprises;the fourth part is the empirical analysis,qualitative analysis research in the previous basis,in accordance with the classification of the use of small and medium-sized private enterprises selected in 2011-2014 China's small and medium-sized private listed companies Our financial data and chairman of political association data,the regression model of small and medium-sized private enterprises establish political connection on the scale of loans and loan period,thereby providing empirical evidence for the political association can promote the financing capacity of small and medium-sized private enterprises concluded;fifth part is the conclusion and prospect,through the results and draw the corresponding conclusion.Give policy recommendations.