Corporate Growth,cash Holdings And Capital Structure Dynamic Adjustment

As one of the most important financial decisions,the decision of capital structure of an enterprise is related to whether a company can continue healthy growth and plays an important role in the success of business operation.From the company to maximize the value of the angle,the adjusting speed of capital structure on a company in the adjustment process of adjusting the balance of costs and benefits of the adjustment,then the costs and benefits as long as the adjustment of the capital structure(optimal capital structure)is determined.According to the dynamic trade-off theory,when enterprises adjust the marginal revenue and marginal cost of capital structure,the capital structure is the optimal capital structure of enterprises.Therefore,when the company's actual capital structure deviates from the target capital structure,enterprises can keep the real capital structure close to the target capital structure according to their internal governance structure and external environment,so as to maximize the value of enterprises.However,with the outbreak of the financial crisis in 2008,more and more managers pay much attention to corporate cash holdings.Cash holding is not only related to the survival and development of enterprises,but also helps enterprises to get out of the capital dilemma,which is an activity fund of internal storage.Corporate cash holdings are closely related not only to the production and operation activities of enterprises,but also to various investment and financing activities.Therefore,cash has the strongest liquidity in all assets of enterprises,and it will also affect the dynamic adjustment of capital structure of enterprises.At present,the domestic and foreign literature is not difficult to find,the lack of relevant research on the dynamic adjustment of capital structure and cash holdings,these studies did not the enterprise characteristics and cash holdings combined research on the interaction between the two effects on the adjustment of capital structure,the non symmetry and most scholars have not considered the enterprise capital structure,the existing research conclusion there is great consistency.Therefore,this paper adopts the combination of theoretical analysis and empirical research methods,from the point of view of asymmetric capital structure,discusses the relationship between cash holdings and corporate growth and the dynamic adjustment of capital structure,trying to find and provide a new perspective for the dynamic adjustment of capital structure theory.This paper selects 2007-2016 years of China's A shares of non-financial listed companies as research samples,establish a partial adjustment model with fixed effect regression model found that:(1)Chinese listed companies do exist capital structure adjustment behavior,and with asymmetric adjustment of capital structure,namely the enterprise is less than the upward downward adjustment of capital structure adjustment speed the speed and average speed of adjustment of the capital structure of Chinese listed companies is 50.9%,(2)the speed of dynamic adjustment of capital structure significantly affect the level of corporate cash holdings,and the effect is asymmetric.When the enterprise is in high debt,cash holdings and the speed of capital structure is positively related,while in the low level of debt,cash holdings and the speed of capital structure is negatively related to corporate cash holdings accelerated the speed of downward adjustment of corporate capital structure,and capital structure to adjust the speed with the increase of cash holdings decreased;(3)in the high debt level,enterprise growth promoting positive impact of cash holdings on the capital structure adjustment speed,while in the low debt level,enterprise growth can significantly reduce the current cash holding adjustable negative influence on the capital structure of the whole speed.Thus,the growth of enterprise significantly affects the relationship between cash holding and the asymmetric adjustment of capital structure.The further study also shows that both static cash holding and dynamic cash holding have significant influence on the asymmetric adjustment of enterprise capital structure.This study is not only to perfect the capital structure theory,but also provide the basis for cash holding effect on capital decision,also for investors and regulators in the analysis of the situation of listed company to provide a good reference,have strong inspiration for China's listed companies make better capital structure decision.