Industrial Policy And The Dynamic Adjustment Of Capital Structure

The capital structure of an enterprise is formed on the basis of comprehensive consideration of changes in the internal and external environment.Therefore,the capital structure of an enterprise is often in a dynamic change.In recent years,with the development of theoretical basis and empirical methods,the field of capital structure has begun to expand toward the trend of dynamic research,that is,the dynamic adjustment of corporate capital structure.Through the analysis of the dynamic adjustment process of the capital structure and the influencing factors,it helps enterprises to understand the ever-changing internal and external environment,attach importance to the grasp of macroeconomic policies,and timely adjust and optimize the capital structure.It can not only keep the company's financial status in a relatively safe state,but also further enhance the value of the company.For China in the transition period,institutional factors may be one of the main factors affecting corporate financing decisions,and are increasingly becoming hot topics in the field of capital structure research.Therefore,the dynamic adjustment of the capital structure from the institutional level research on the issue is more in line with the actual situation of Chinese companies.Industrial policy is an institutional background that must be paid attention to in researching corporate behavior.The effect of its implementation often needs to be reflected by the behavior of micro-enterprises.The corporate financing behavior is a good perspective.For this reason,this article makes an in-depth analysis of the role played by industrial policy in the dynamic adjustment of capital structure.Based on this,the paper analyzes the role of the nature of property rights and product market competition in regulating its relationship.At the same time,from the perspective of the dynamic adjustment of corporate capital structure,the implementation effects of industrial policy is examined,which provides new evidence for the micro-effect mechanism of industrial policy on economic development.This article uses the data of the 2402 A-share listed companies during the “Eleventh Five-Year Plan”(2006-2010)and “Twelfth Five-Year Plan”(2011-2015)planning period as research samples.On the basis of the standard partial adjustment model,an expansion model of the dynamic adjustment of the capital structure by industrial policy will empirically test whether the industrial policy will affect the dynamic adjustment of the capital structure of the enterprise.Taking into account the two regulatory variables of the nature of property rights and product market competition,how does the industrial policy affect the speed of capital structure adjustment.In order to provide enterprises with an understanding of the differences in adjustment speeds under different circumstances,and provide evidence support for the enterprises to adjust their capital structure in a timely manner.The research results show that:(1)Compared with enterprises without industrial policy support,the dynamic adjustment of the capital structure of enterprises with industrial policy support is faster.The rapid adjustment of the capital structure means that the shorter the time required for the company to adjust to the target capital structure.It will keep the enterprise in a state of financial security to some extent,indicating that the support of industrial policies has optimized the capital structure of the company;(2)There is a significant difference in the speed of the dynamic adjustment of the capital structure of different property right companies: the impact of industrial policy on the speed of capital structure adjustment is more pronounced in non-state-owned enterprises;(3)After considering the effects of product market competition,it is found that the more intense the competition in the product market,the more pronounced the impact of industrial policy on the speed of capital structure adjustment.Therefore,the research in this paper can not only enrich the research field of dynamic adjustment of capital structure,but also test the microcosmic effect of industrial policy,provide new evidence for the institutional background affecting corporate behavior.Finally,Suggestions are put forward from the perspective of enterprise and government management.