Product Market Competition Financing Constraints And Financial Flexibility

With the transformation of the domestic economy in 2015,China's current economic growth rate has been transformed from high-speed growth to medium-high growth.Under the new normal economic,domestic and international economic environment full of uncertainty make the enterprise strategy development face more market environment crisis,many enterprises because of the weaker risk tolerance,result in unable to cope with the present business environment changes.Based on this,the enterprise how to use financial flexibility "prevention" and "use" two big functions,enhance its ability to resist risk,and thus to avoid the adverse impact of the external environment fluctuation and financial crisis,realize own "corner overtaking" leapfrog development,has become the focus of enterprise managers.Financial flexibility is the enterprise to deal with the change of internal and external environment to meet the daily cash payments and effective investment,capital environment protection from a kind of means and methods,with the impact of uncertainty in both turn adversity and improve enterprise value.Based on both developed and developing countries,financial flexibility has become the focus of enterprises.Currently,the literature on financial flexibility mainly focuses on the internal governance factors,while the research on the external governance factor product market competition is relatively small.Product market competition belongs to the category of the theory of industrial organization,and to explore its and flexible financial concept relation between the finance is not only beneficial to the intersection of disciplines development,and better able to flexible policy analysis from the practical significance to enterprise financial challenges;At the same time,the financing constraint is the current situation of Chinese enterprises.The size of financing constraints not only affects the agency cost of enterprises,but also restricts theinvestment level of enterprises.On this basis,this article will focus on research under different degree of financing constraints,product market competition will be plundered effect and increase the influence of enterprise financial flexibility,provides a combination of industry competition and environmental uncertainty multi-dimensional research perspective,so that they can more truly simulate the enterprise facing the market environment,is a theoretical value and practical significance,and also for enterprises to provide effective security and reserve the differences of flexible financial reference.To sum up,this paper will first review the existing domestic and foreign literatures about the acquisition mode and measures of financial flexibility.Combining theoretical basis and literature analysis existing product market competition and financial flexibility,flexible financing constraints and financial relations,dig out this article research Angle of view,that is,from the future uncertainty environment,this paper first to study the effect of product market competition on financial flexibility;The financing constraint is incorporated into the internal mechanism of product market competition and financial flexibility.Empirical research part,this article selects the a-share listed companies in China from 2012 to 2016,A total of 10375 samples as the research object,in effect,effect and financial contingency effect under the guidance of theoretical basis,such as by hypothesis test is put forward,in Hertz fanta,index(HHI)as indicators of the degree of product market competition,to build with the enterprise financial flexible empirical model,and according to this article research the financial flexibility must be based on the content is divided into two groups.The sample is divided into two groups,namely cash flexibility and debt flexibility,according to financial flexibility,to probe into the influence of external environment.To construct its and financing constraints by item,into the back of product market competition and the relationship between financial flexibility and empirical test,finally in different degree of financing constraints grouping,verify its existence scene effect.Finally empirical study results indicate that:(1)the financial flexibility has the ability to resist the external environment risk,main show is when the enterprise in the agency risk and the risk of looting in the market competition,will consider for more financial flexibility;(2)in order to alleviate the financing constraints of plundering costs,will induce corporate investors in the face of fierce market competition keep a higher level of financial flexibility,make the enterprise can more effectively play the role of financial flexibility;(3)based on property rights,the uncertainty of capital market makes non-state-owned enterprises more inclined to reserve financial flexibility.