Research On The Impact Of Financing Constraints On Chinese Enterprises' Foreign Direct Investment

With the gradual advancement of China's internationalization strategy,the relationship between countries has become closer and closer,the scale of China's foreign direct investment has been expanding,and the industries and regions of investment have become more diversified,which has driven the rapid development of China's economy and industry.Rapid adjustment of the structure.The "One Belt,One Road" proposal has ignited the enthusiasm of enterprises,and more and more enterprises have begun to participate in the international market through foreign direct investment.However,since the early stage of foreign direct investment requires a large amount of financial support,and China's financial market is not perfect,it is difficult for Chinese companies to obtain the funds needed for investment in the financial market.Therefore,the financing problem may affect the foreign direct investment of Chinese enterprises to a certain extent.In order to clarify the impact of financing constraints on Chinese enterprises' foreign direct investment,this paper will explore the relationship between the two and related factors.The purpose of this paper is to explore whether financing constraints have an impact on Chinese enterprises' foreign direct investment,and through a combination of theoretical analysis and empirical analysis,it proves that financing difficulties will have an impact on enterprises' foreign direct investment,and further analyze the internal and external factors of enterprises.The impact of the relationship between the two.The basic framework of this paper is as follows:Firstly,this paper carefully combs the relevant domestic and foreign literatures and summarizes them,defines the concept of foreign direct investment and financing constraints,and summarizes the theoretical basis put forward by scholars.Then it studies the current situation of Chinese enterprises' foreign direct investment and financing constraints and the relationship between the two.Through the above analysis,the theoretical mechanism of the impact of financing constraints on Chinese foreign direct investment is speculated and hypotheses are proposed.Finally,using the panel data of listed companies from 2003 to 2015 to construct financing constraint indicators,and matching the data of "China Foreign Direct Investment Enterprises Directory" and"CSMAR Guotaian Listed Company Financial Statements",empirically testing the financing constraints on Chinese enterprises' foreign direct investment.As a result,it was found that the smaller the degree of financing constraints,the more enterprises tend to make foreign direct investment.In order to make the results more stable,this paper separately conducted the endogenous test of financing constraints and foreign direct investment,the financing constraint indicators and the robustness test of the empirical methods to ensure the accuracy of the regression results.At the same time,this paper also carried out further analysis to empirically test the influence of ownership,productivity and other dominant factors on the relationship between the two.Through theoretical and empirical analysis,this paper has four conclusions:First,financing constraints are not conducive to corporate foreign direct investment.The smaller the financing constraints on enterprises,the more enterprises tend to invest in foreign direct investment.Second,compared with state-owned enterprises,financing constraints have a stronger negative impact on private enterprises' foreign direct investment.This is because,on the one hand,when Chinese companies are financing,most of the choices are made through banks.However,the five major banks in China are state-owned enterprises.When lending,they will prefer the same state-owned enterprises;On the other hand,state-owned enterprises are more closely related to the government and can enjoy more preferential policies.Third,high-productivity companies are more inclined to make foreign investment decisions,so financing constraints have a greater impact on these companies' foreign direct investment.When a company has high productivity,it will be more inclined to make foreign investment decisions,and the demand for funds will also increase.At this time,the impact of financing constraints on Chinese enterprises' foreign direct investment is more significant.Fourth,the scale effect and regional effects of enterprises can alleviate the negative impact of financing constraints on Chinese enterprises' foreign direct investment.Finally,based on the conclusions drawn,this paper proposes specific recommendations for the government and enterprises.The main innovations of this paper are as follows:First,use more comprehensive indicators to measure financing constraints.The existing literature adopts the single index method for the selection of financing constraint indicators.This paper uses the financial data of Chinese listed companies to construct comprehensive financing constraint indicators.Secondly,a comprehensive analysis of the impact of productivity and ownership.Although the past literature explores the impact of productivity and ownership factors on corporate foreign direct investment,the analysis is not comprehensive,and this paper further explores its impact by classifying productivity and ownership.Third,examine the impact of other variables on the results.When the existing literature studies the relationship between financing constraints and foreign direct investment,most of them focus on productivity,ownership and external dependence,while this paper focuses on other factors,such as the size of the enterprise,the impact of the region on the results.