| The State Department promulgated the "Outline of China's Industrial Policy" and"Decision on the Main Points of Current Industrial Policy" in February and March,1989,respectively,when China's industrial policy emphasized the development of a number of pillar industries.With the introduction of "Catalog of Industry Structure Adjustment Guidance" in the new period,the scope of implementation of China's industrial policy has gradually expanded.China has beccome a country that has implemented many industrial policies,which cover almost every aspect of the national economy.Nowadays,it's particularly important for the development of China's economy to implement accurate and effective industrial policies especially when China is at a critical stage of industrial transformation and the supply of excellent policies.Therefore,assessing the economic effects of industrial policies from different perspectives has important significance under the background of current economic.As a growing emerging economy,the development time of our stock market is less than 30 years,which has many problems such as the lack of rational maturity of investors,inadequate legal mechanisms,and the growing accumulation of financial risks.The stock market is turbulent and frequent.Theoretically,industrial policies can ease the financing constraints,choose good investment projects and promote the growth of corporate value.At the same time,they will improve the level of market competition,reducing the motivation of information disclosure management,which can declare the risk of stock price crashes.However,it still require empirical test about whether China's industrial policy can affect the company's stock price crash risk in the real situation.It is a good perspective to evaluate the economic effect of industrial policy taking the stock price crash risk as a consequence.Based on the data of China's A-share listed companies from 2007 to 2016,this paper empirically examines the interaction between industrial policy and stock price crash risk.What's more,the paper examines what's the role of nature of property right and marketization process play in the relationship.The following conclusion are found in this paper.1.The implementation of industrial policies can reduce the company's stock price crash risk.First,industries encouraged by policies can receive support from credit,taxation,government subsidies,and etc.,alleviating the company's financing constraints,which can help enterprises seize investment opportunities,promote the growth of enterprises,and reduce the motivation of information disclosure management,leading the reduce the risk of stock price crash.Second,the relaxation of government administrative approvals and restrictions on access will increase the level of market competition in the encouraged industries,so it will reduce the risk of stock price crash through inhibit the concealment opportunities and channels of management relying on restraint effects and information effects.2.For companies of different property rights,the degree of reduction of the stock price crash risk by industrial policies is different.The negative correlation between industrial policy and stock price crash risk in the state-owned enterprise group is even stronger.The reason is when the government relaxes the credit approval and market access restrictions,it will increase the degree of market competition of encouraging industries and put pressure on state-owned enterprises.Under the pressure of full information comparison and bankruptcy liquidation,the operating efficiency of the state-owned enterprise will inevitably increase continuously,and the agency cost of the state-owned enterprises will decline more significantly,weakening the tendency of agency behavior of information disclosure manipulations,thus weakening the risk of the stock price crash risk to some extent.3.For companies in different marketization processes,the impact of industrial policies on the risk of stock price crash is different.Specifically,industrial policies have a more significant impact on the risk of corporate crash in areas with lower levels of marketization.The main reason is that resource effects such as credit brought about by industrial policies will reduce the degree of financing constraints of enterprises in less marketized regions to a greater extent,helping companies to seize better investment projects,improving the operation efficiency and performance of enterprises,reducing the risk of stock price crash.The research results of this paper show that our country's industrial policy plays an important role in the capital market,and the government should continuously improve the industrial policy system to promote the upgrading and transformation of the industrial structure.However,the market intervention is never perfect.The key to the problem is to choose between imperfect government and imperfect markets,and to seek a balance between the government and the market.Only in this way can the industrial policy achieve the greatest positive effect.We should continue to deepen reforms,gradually eliminate discrimination in policies and finance between private enterprises and state-owned enterprises,and improve the efficiency of industrial policy implementation.Industrial policy formulation should be closely integrated with the market development situation.It must not only respect the inherent laws of industrial development,formulating corresponding industrial policies based on the actual development of the region,but also emphasize the basic role of the market in resource allocation,avoiding distortions of market mechanism caused by excessive market intervention. |
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