Analysis Of The Causes And Suggestions Of High Leverage Ratio Of Non-financial Enterprises In China

In the decade after the financial crisis,China adopted a series of macroeconomic policies against the economic cycle to achieve rapid economic growth compared to other countries,and also brought about the negative impact of the rapid growth of non-financial corporate leverage.From 2015,the Party Central Committee and the State Council proposed “three to one,one reduction and one supplement” to propose a “economic de-leverage” at the financial work conference in 2018.Non-financial enterprises have been taking measures to break the bar with the encouragement of the government.The world is also constantly summarizing the experiences and lessons of past corporate deleveraging and proposing new policy recommendations on the new theoretical analysis framework.First of all,this paper observes the current situation of the leverage ratio of non-financial enterprises in China after the financial crisis.On the timeline,2008 is the watershed of the leverage ratio of non-financial enterprises.By the end of 2017,the growth rate in the ten years is nearly 60 percentage points.At the rate level,the leverage ratio of non-financial enterprises is much higher than that of the residential sector and government departments;in the international arena,the leverage ratio of non-financial enterprises in China far exceeds that of other developed countries,combined with China's unique financial structure and high savings rate,etc.The leverage ratio of financial enterprises has a small probability of triggering a large-scale debt crisis,but it is necessary to prevent financial systemic risks that may arise from the continued expansion of non-financial corporate debt.From the perspective of the internal structure of non-financial enterprises: in different industries,the leverage ratio of the real estate industry has risen rapidly,while other industries have declined partially,but the decline rate is not large,while the leverage ratio of high-tech industries has generally declined,and the decline is much larger than other industries;Among them,the leverage ratio of state-owned enterprises is higher than that of non-state-owned enterprises,and the growth rate of leverage of state-owned enterprises is also faster than that of non-state-owned enterprises.At the same time,the leverage ratio of large and medium-sized enterprises within state-owned enterprises rises faster.It can be clearly observed that there are structural problems in the leverage ratio of non-financial enterprises in China.Secondly,starting from the traditional classical theory,combined with the analysis and summary of the previous research literature,the influencing factors can be divided into two levels: the macroeconomic level and the micro-enterprise level.Among them,macro factors include: fiscal policy and monetary policy,micro factors include: enterprise size,tangible asset rate,non-debt tax shield,profitability,growth opportunities,nature of corporate expenses,accounts receivable turnover,cash income,Ownership and industry nature.From the macro leverage index,it is decomposed into the micro-enterprise interest-bearing debt ratio and the micro-enterprise return on capital.Combining the literatures read in the past with the actual situation in China,the analysis may affect the mechanism of the high leverage rate of non-financial enterprises.And put forward two corresponding hypotheses.Then,using the balance panel data of China's Shanghai and Shenzhen A-share listed companies in 2008-2017 as a fixed-effects model,and using ownership and industry variables as dummy variables to empirically test hypothesis 1 and hypothesis 2:(1)in different ownership enterprises,the government implemented loose policies to make financial resources allocated to state-owned enterprises with low return on investment,resulting in higher leverage ratios of non-financial companies;(2)in different industries,the government implemented loose policies to allocate financial resources to production capacity.Industries such as surplus industries and high-selling real estate industries,which have low return on invested capital or low marginal efficiency,have led to a decline in the return on capital of the entire non-financial corporate sector,which has led to a rise in leverage.Finally,from the current context in which China's economy has entered a period of high-quality development,the impact of trade wars on exports,and the invisible weakness of household consumption,combined with the previous empirical analysis,it is necessary to structurally reduce non-financial enterprises under the premise of steady growth.Leverage,in the fiscal policy and monetary policy,treats non-state-owned enterprises and state-owned enterprises equally,optimizes the allocation of financial resources,and allocates more financial resources to non-state-owned enterprises with higher return on investment capital and high-tech industries with higher marginal efficiency.