The Impact Of Economic Policy Uncertainty On Enterprise Investment And Financing

Since the financial crisis in 2008,economic policy uncertainty has attracted more and more attention from scholars at domestic and overseas.Uncertainty is one of the causes of economic recession and closely related to the formulation of economic policy and the trend of macro economy.The investment and financing of enterprises is affected by economic policies.Therefore,the uncertainty of economic policies will affect the investment and financing level of enterprises.The research for economic policy uncertainty at domestic and overseas began in the Bloom of the pioneering research.Bloom in 2008 used policy uncertainty to analyze the impact of financial crisis on the U.S.economy.More and more scholars began to study economic policy uncertainty measurement and statistical method after that.The research direction is from the uncertainty of the original statistical research to how to influence macroeconomic and microeconomic research,and now study the investment and financing behavior of the uncertainty of economic policy for the enterprises.The research of Baker et al.(2016)brought a big breakthrough to study in this field.He used the frequency of economically sensitive words from media reports,which is the ten most popular media in the United States,to build economic policy uncertainty index(EPU).The index is recognized and used by a number of scholars.Foreign scholars used the similar method to calculate the uncertainty of the index of 21 countries or regions,including China.This method selects more accurate and extensive economic words,such as "uncertainty","tax","economic fluctuations",etc.The research in this paper is based on the index under this measurement method.This paper sort out domestic and foreign literature on the relationship between economic policy uncertainty and enterprise investment and financing,and try to further expand the research on the influence of enterprise investment and financing decisions.In this paper,the sources of uncertainty select the index provided by the economic policy uncertainty website,and based on the improved model to analyze the impact of economic policy uncertainty on enterprise investment and financing.Discuss the degree and mechanism of debt financing and equity financing affected by uncertainty.And analyze the effect of uncertainty on corporate investment from the real option effect,risk premium effect and careful saving effect Explore the different function that uncertainty affects enterprise investment.Analyze the changes of investment and financing decisions of enterprises with different shareholder nature under the impact of uncertainty.And empirically analyze the effect of economic policy uncertainty on enterprise investment in the short and long term.Based on the above research,It is found that the increase of economic policy uncertainty will reduce the scale of enterprises’ external financing and investment level,and state-owned enterprises are more affected by the impact of uncertainty.In addition,the impact of uncertainty on enterprise investment shows a restraining effect in the short term,but this effect will be transformed into a promoting effect in the long term.