Research On The Relationship Between Political Connection,Bank Financing And Innovation Of Small And Medium Enterprises

Recently,the importance of innovative investment capacity of private enterprises has become increasingly prominent.Capital is an important factor in enterprise innovation.At present,due to the flaws of the financial system,private enterprises still have financing constraints,capital is the most scarce elements of enterprise innovation,will inevitably affect the innovation activities of enterprises.While a large number of studies show that political connections can effectively alleviate the institutional defects on the development of private enterprises.By analyzing the political connections of small and medium-sized enterprises on the Growth Enterprise Market(GEM),statistics show that by 2013,124 out of 355 listed companies have political connections,accounting for about 34.9%.Showing that private enterprises are increasingly concerned to strengthen political connections.This paper analyzes the impact of political connection on the innovation of small and medium-sized private enterprises from the perspective of the important external financing of bank loans obtained by enterprises.On the basis of reading and collating domestic and foreign literature,combining the present situation of China's private enterprises and the background of China's institutional environment,the paper uses the method of theoretical analysis and empirical analysis to analyze the impact of political association.Firstly,this paper analyzes the theoretical foundation behind the impact of political linkages on enterprise innovation,mainly from the information asymmetry theory and rent-seeking theory,and from the perspective of game theory to verify the hypothesis,build a model to analyze the impact of political connections on corporate finance and innovation.Next,on this basis put forward the research hypothesis.Finally,we test the hypotheses from the perspective of measurement.We take the listed companies in the GEM from 2009 to 2013 as the samples and use the data of the listed companies on the GEM in 2014,the paper has controlled a series of factors that affect innovation,the main conclusions are as follows:(1)Political connection can alleviate the financing pressure,playing a "hand of support"role.And the greater the intensity of political linkages,the more obvious the effects of financial relief,especially in the infornmation industry;(2)Bank financing cannot effectively promote the innovation investment of enterprises,especially in the manufacturing enterprises the effect is more significant;the political connection cannot effectively promote the innovation investment of enterprises,reflecting the influence of the "hand of predation",which increases as the intensity of political association increases.