Financial Misallocation,Debt Structure And R&D:Evidence From International Market

Since the establishment of the market economy system in 1992,China's financial market has experienced great development.However,a variety of problems has emerged at the same time: widespread monopoly,waste of resources and other phenomena,which can be summarized as misallocation of financial resources.More specifically,financial resources are not allocated in accordance with the principle of efficiency.Innovation which creates the non-material form of capital assets for enterprises,is a long-term resource,is the key force to promote China's economic transition.This paper explores the driving factors of innovation from the perspective of financial misallocation,analyzes the mechanism and effect,which is helpful to understand the constraints in the process of innovation and provides a new perspective for solving the current innovation bottleneck of Chinese enterprises in the process of financial market reform.The research has important theoretical and practical significance.This paper selects 16238 listed companies in the world from 2008 to 2017 as samples.The key variable financial misallocation is calculated by regression residuals method and the paper defines firms with excess credit resources as positive financial misallocation firms,firms with deficiency credit resources as negative financial misallocation.By constructing the regression model,the paper comes to the conclusions that financial misallocation is positively correlated with debt ratio and current debt ratio,negatively correlated with R&D expense;Current debt ratio is negatively correlated with R&D expense.This paper provides a new way to promote China's economic transformation and enterprise innovation.The enlightenment of this paper is as follows.Firstly,we should establish and improve the financial market system,vigorously develop multi-level capital market,give full play to the decisive role of the market in the process of resources allocation.We should reduce the phenomenon of financial misallocation,improve the efficiency of market mechanism to serve for the real economy.Secondly,we should improve the bank credit resource allocation system,eliminate distorted credit resource allocation behavior such as credit discrimination and credit rent-seeking in order to optimize the financing environment of small and medium-sized enterprises and private enterprises.Lastly,the research shows that the allocation of credit resources can effectively alleviate the financing constraints,but it will further aggravate the agency problem and squeeze out the innovation.Therefore,in the process of credit resource allocation we should also strengthen corporate governance,control agency costs and establish special loan management system for R&D.