Research On Managers' Financial Literacy And Debt Financing Preference Behavior

In recent years,with the economic transformation and upgrading and the rapid development of emerging markets,the problems faced by corporate financing have become increasingly serious,which has become an important factor restricting the rapid transformation and development of enterprises.Among them,debt financing has long been the most traditional and major financing method for enterprises,it is also the focus and difficulty of researching corporate financing issues.Scholars at home and abroad have also conducted a large number of theoretical and empirical studies on corporate financing issues,and the results show that companies mainly prefer short-term debt or higher debt ratios in the financing process.Since the establishment of the securities market at the end of the 20 th century,the financing preferences of Chinese listed companies have begun to lean towards equity financing,the first choice for raising funds for companies is no longer debt financing,but rather acts of equity financing,such as selling new shares in the open market,which deviates from the theory of financing priority.Therefore,the study of corporate debt financing has received close attention from the theoretical and practical circles.As far as China's listed companies are concerned,their financing models have just changed,and they are still in the stage of gradual development,they have not yet achieved full marketization,and many factors will affect their financing behavior.In addition,high-level echelon theory states that the personal characteristics of managers will have a significant impact on corporate output,strategic choices and performance levels.Because corporate managers are responsible for strategic planning,implementation and resource allocation,often due to differences in personal thinking,varying degrees of ability,level of confidence and risk appetite,differences in corporate decision-making results and significant impact on business operations.Therefore,this paper creatively explores the influence mechanism of managers' financial literacy on their debt financing preferences.On the one hand,it confirms that the manager's background characteristics and personal experience are one of the key factors affecting corporate debt financing preference behavior,which has enriched the research on the relationship between managers' personal characteristics and corporate debt financing;on the other hand,it also confirms that the financial literacy of managers can have a certain effect on corporate debt financing preference behaviors,thereby expanding the research of managers' personal characteristics.At the same time,this article also has certain practical significance for enterprises,and has a certain reference value to the company's debt financing decision-making behavior to a certain extent.It can effectively give full play to the positive role of the personal characteristics of enterprise managers and further promote the increase of enterprise value.This article attempts to theoretically and empirically study the relationship between the financial literacy of core managers(including the chairman and general manager)and the debt financing behavior of Chinese listed companies.First,based on the fact that managers have personal characteristics and incomplete rationality,the theoretical research on the financial literacy of corporate core managers affects debt financing behavior mechanisms,and the results show that the debt financing behavior of managers with high financial literacy is more aggressive.Secondly,using the experience of the financial industry as a proxy variable for the level of financial literacy,an empirical test was performed using multiple regression methods on 17,307 observation samples of Chinese A-share listed companies from 2008 to 2017.The research results show that managers' financial literacy and asset-liability ratios?the debt maturity structure and bank loans showed a significant positive correlation,and a significant negative correlation with commercial credit,but no correlation with bond financing.Finally,the educational background and professional background of managers are used as explanatory variables to test their relationship with corporate debt financing behavior,the results show that there is no significant correlation.The article clarifies the relationship between corporate core managers and debt financing behavior,provides management measures in the field of corporate governance,can help companies determine the correct approach to corporate governance,and take effective measures to prevent corporate core managers from aggressive debt financing behavior.