Research On The Influence Of Economic Policy Uncertainty On The Capital Structure Of Enterprises

In recent years,influenced by the international turmoil,the Brexit and the trade frictions,the world economy has been shrouded in enormous uncertainties.In order to achieve macroeconomic policy objectives,the government will respond to the complex changes of the external economic and financial environment in a timely manner.However,the inherent uncertainty during the economic policy adjustment,coupled with its uncertainty in the process of formulation,implementation and exertion,may have an important impact on micro-business behavior.Capital structure,as an important factor affecting the operation of micro-enterprises,represents the source of corporate funds and the proportion of their composition within a certain period of time.A reasonable capital structure can play a role in reducing financing costs,improving financial freedom and efficiency of capital operations.In view of this,this paper will deeply analyze the impact of economic policy uncertainty on corporate capital structureThis paper takes the quarterly data of companies from 2003 to 2017 as the research sample,which listed on Shanghai and Shenzhen A-share.We use China's economic policy uncertainty index compiled by Baker et al.(2016)as an indicator to measure the uncertainty of China's economic policy.This paper analyzes and demonstrates the overall impact,heterogeneity impact,regional and staged characteristics of economic policy uncertainty on capital structure.And we draw the following conclusions:(1)The uncertainty of economic policy has a significant negative effect on the capital structure of enterprises:the asset-liability ratio of enterprises will decrease by 0.89 percentage points in the next quarter when the index of economic policy uncertainty rises by 1 standard deviation;(2)There is heterogeneity in the impact of economic policy uncertainty on the capital structure of enterprises with different property rights and different industry characteristics.On the whole,non-state-owned enterprises are more affected by economic policy uncertainty.And in capital-intensive industries,state-owned enterprises are more affected by economic policy uncertainty.While in labor-intensive and technology-intensive industries,non-state-owned enterprises are less impacted by economic policy uncertainty;(3)In areas with low degree of financial marketization,the negative relationship between economic policy uncertainty and enterprises asset-liability ratio is more obvious.And with the promotion of interest rate marketization reform,the impact of economic policy uncertainty has been alleviated;(4)The increase of economic policy uncertainty will affect the structural adjustment of capital structure through commercial credit supply channels,and the commercial credit supply behavior of different types of enterprises shows a differentiated featureFor that reason,this paper proposes the following recommendations:(1)The government departments ought to pay attention to the importance of economic policy stability and increase support for specific types of enterprises that are deeply affected by uncertainty.In the current process of transition from“deleveraging" to"stabilizing leverage",the government should pay attention to the negative impact of economic policy uncertainty on the capital structure of enterprises;(2)The enterprises should strengthen the analysis and evaluation of macroeconomic policies,especially non-state-owned enterprises and technology-intensive enterprises.They can test the sensitivity of financing programs to the changes of economic policy through stress test and other methods.At the same time,enterprises can try to construct different financing models to flexibly meet the capital demand,so as to resolve the operational pressure brought by the uncertainty of economic policies partly;(3)In view of the regional and phased differences of economic policy uncertainty on capital structure,the government should further accelerate the financial marketization process and continue to deepen the reform of interest rate marketization,so as to weaken the influence of economic policy uncertainty.