Dividend Smoothing And Corporate Debt Financing

The debt financing of listed companies has been the same topic concerned by both the theoretical circle and listed company.Debt financing,as important source of funds for the enterprise,has essential influence on the company's operation and development.As securities capital market in China is improving gradually,the stock market has become the important channel to collect company's financial and operational information and to indirectly influence the debt financing behavior of company.Therefore,listed companies have strong motivation to use the positive signal released by the stock market actively to serve the company's debt financing decision.Dividend distribution,as the information to reflect the company's distribution policy,is also an important signal,which can show the company's financial and operational situation.Stable and smooth dividend policy can release the information of steady finance and healthy management outward,and improve the potential financier's and investor's confidence in the company,which can create favorable condition for the company's debt financing.Previous research on influencing factors of debt financing mainly focuses on the influence of the company's financial status,operational condition.the factor of the internal management and external management environment,lack of investigation on the influence,which signal transmission effect of dividend policy of listed companies has on the corporation's debt financing situation.Based on the research perspective above,this article studies the influence,which dividend policy stability has on the corporation's debt financing decision by calculating the company's dividend policy stability.Based on the signal transmission theory and regarding Shanghai and Shenzhen A-share listed companies from 2010 to 2015 as research samples,this article analyses theoretically and studies empirically the influence,which corporation's dividend policy stability has on debt financing.The result shows that the higher dividend stability of the company,the better situation of the company's debt financing.And these companies have higher financial leverage,more long-term debt,and lower financing cost.In the case of grouping test,this paper has further found that in the non-state controlled companies,the higher degree of industry competition and the stronger financing constraints of the company,the more significant effect of the signal of dividend stability.The study of this article expands the field of vision of research on the debt financing related issues and enriches the study of related documents.In practice,the research conclusion of this article has certain reference significance for listed company's dividend distribution policy and debt financing selection strategy.