The Relation Study Of The Financing Constraints, Ownership Structure And Investment-cash Flow Sensitivities

The investment and financing are the most important parts of the company's existence and development.Also,financing constraints and ownership structure have great influence on the corporate governance and value.A large amount of empirical studies show that the investment is sensitive to the cashflow.The sensitivity will be affected by the financing constraints and ownership structure.Therefore,on the background of mixed ownership structure reform,it's meaningful to use information asymmetry theory and agent-principal theory to study the relation of the financing constraints,ownership structure and investment-cashflow sentivity.The paper builds the empirical model by using 2011-2015 data of listed companies.I choose different financial index which is suitable for the Chinese economic background and build the Logistic Regression Model to construct financing constraint index.Using Palani Model(1998)and Vogt Model(1994),the study examines the ownership structure's influence on the financing constraint and investment-cashflow sentivity.Using dummy,I do the comparative analysis of the performances of state-owned and private-owned companies,equity-centralization and equity-decentralization companies.The study proves that the investment is sensitive to the cashflow of Chinese listed companies.The financing constraint is stronger,and the investment-cashflow sentivity is stronger.The higher the proportion of state-owned shares,the fewer the financing constraint and investment-cashflow sentivity.It is related to the policy advantages and size of the state-owned company which be explained by the information asymmetry theory.Ownership concentration is positively associated with financing constraints and investment-cashflow sentivity,and it can be explained by the agent-principal theory.The higher the proportion of large shareholders,the more abuse of power for private gain through over-investment.It leads to higher dependency from investment to internal funds and the financing constraint is stronger.Through all the study above,I draw the conclusion and put forward the policy suggestion: deepen the development of multilevel market,propel the reform of mixed-ownership structure,and improve the corporate governance.