Pyramidal Structure, Financing Channels And Innovation Investments

As widely used in the enterprise group in China,there are many studies about the pyramid structure,which may cause the agency problem between the large shareholders and the minority investors.For enterprises in GEM,there are active innovation and more R&D investments,which means more support from the financing.Will the separation of the controlling rights and cash flow rights influence the choice of the financing channels and be harmful to the innovation investment?In this paper,the relevant literatures about ownership structure,financing channels and innovation investment will be systematically presented and analyzed.Secondly,this paper selects the data of listed company clusters in Growth Enterprises Market from 2009 to 2016 as samples,and group the whole sample into two categories: high financial constraints and low financial constraints and manually searches characteristics of the pyramid as the representative of the ownership structure.This paper selects proportion of internal financing,stock financing and debt financing as the financing channels and the R&D to measure the innovation investment.Finally,this paper applies empirical analyses to investigate and explore the relationships between ownership structure,financing channels and innovation investment under different financing constraint intensity..A conclusion has been made by regression analytical studies:(1)If other conditions are same,the layer,the complexity of the pyramid and the separation of the controlling rights and cash flow rights have negative effect on the internal financing and stock financing and positive effect on the debt financing.(2)The internal financing and stock financing have positive effect on R&D,while the more debt financing will lead to less R&D.(3)The layer,the complexity of the pyramid and the separation of two rights have negative effect on R&D.(4)When the separation of two rights is high,the positive effect of the internal and stock financing on R&D will be weaker and the negative effect of the debt financing on R&D will be stronger.Although the researches on pyramidal structure,financing channels and innovation investment have formed into a perfect system,few scholars pay attention to the influence of agency cost of the pyramid to the financing channels and innovation investment.This thesis not only aim to enrich the existing articles but also look forward to provide some meaningful points about the optimization of ownership structure,helping make more investment to the innovation project of the company.By the way,the government should also try to improve the securities regulatory system and the quality of the listed companies' financial reports.