Industrial Policy And Corporate Cash Holdings

Cash is the lifeblood of the survival of the enterprise and the blood of development.As the most liquid and profitable asset within the enterprise,its holding decision is an important part of financial decision-making.In the absence of sufficient cash,enterprises are prone to financial difficulties and face bankruptcy risks.In particular,enterprises subject to financing will hold more cash to prevent uncertainty risks.Studying cash holding behavior is not only an important part of corporate financial decision-making,but also an important topic for research at home and abroad.Therefore,it is of great significance to study the influencing factors of cash holding decisions of listed companies in China.For China in the period of emerging transition,institutional factors may be one of the important factors affecting the decision-making behavior of Chinese enterprises,and it has become a hot topic in researching corporate investment and financing behavior.Therefore,from the institutional level,it faces corporate cash holdings.The discussion of behavior is in line with the actual situation in China.China is a country with more industrial policies.As an important form of government regulation and control of the economy,industrial policy can guide the flow of social funds and optimize resource allocation,thus promoting the adjustment of industrial structure and promoting economic transformation and upgrading.The economic consequences of industrial policy have always been a matter of great concern to the practical and theoretical circles.The economic consequences of industrial policies often need to be reflected through the behavior of micro-enterprises.To this end,this paper attempts to explore the impact of industrial policies on corporate cash holdings.The national macro-industry policy provides new evidence to support the decision-making behavior of micro-enterprises.This paper is based on the data of China's Shanghai and Shenzhen A-share listed companies during the 11 th Five-Year Plan(2006-2010),the 12 th Five-Year Plan(2011-2015)and the 13 th Five-Year Plan(2016-2017).In order to study the sample,the paper empirically tests the impact of national industrial policies on corporate cash holdings,and on this basis,introduces adjustment variables such as property rights and product market competition,and examines how industrial policies affect corporate cash holding behavior under different circumstances.Make the research conclusions richer.The specific research results show that:(1)Compared with enterprises not supported by industrial policies,enterprises supported by industrial policies hold less cash.This shows that the support of industrial policies can improve the financing environment of enterprises and reduce the motives for enterprises to hold cash;(2)For enterprises with different property rights,the impact of industrial policies on corporate cash holdings is different,compared with stateowned enterprises,industrial policies and The negative correlation between cash holdings is more significant in non-state-owned enterprises;(3)product market competition will affect the relationship between industrial policies and corporate cash holdings,relative to companies with strong competition in product markets,industrial policies and cash holdings Some negative correlations are more pronounced in companies with weaker competition in the product market.Therefore,the research in this paper can not only expand the research field of corporate cash holding,but also provide new evidence support for the macro industry policy affecting corporate behavior.Finally,this paper puts forward some suggestions for reference from the perspective of enterprise and government management.