The Impact Of Interest Rate Liberalization On The Risk Of Corporate Stock Price Collapse

The collapse of stock price has chain effect and contagion effect,which will not only damage the interests of investors,lead to the sharp reduction of investors’ wealth,but also affect financial institutions and other enterprises,and endanger the healthy operation of financial market and the stable development of real economy.Therefore,in the process of any macro policy implementation,we should pay attention to the measurement and change of the risk of stock price collapse,and study its internal mechanism.Whether the source of capital is abundant or not is an important factor that affects the risk of stock price collapse.The market-oriented reform of interest rate is a major reform implemented by the central bank,which has a wide range of influence and takes a long time.It is an inevitable measure to improve the transmission effect of monetary policy and give full play to the regulatory function of price instruments after the market-oriented reform.The marketization of interest rate has changed the way of determining interest rate.Firstly,it has an impact on the degree of competition in the financial industry.By influencing the financing constraints,financing costs and opportunity costs of the entity enterprises,it has an impact on the daily activities of the enterprises,and then the risk of stock price collapse.It is of theoretical and practical significance to study the relationship between interest rate liberalization and the risk of stock price collapse.Since the reform of interest rate liberalization began in 2004,it was basically completed in 2016,and the new accounting standards began to be implemented in 2007,this paper selects the data of listed companies from 2008 to 2016 to study the relationship between interest rate liberalization and the risk of stock price collapse.In this paper,GMM and mixed regression are used to study the relationship between the level of interest rate liberalization and the risk of stock price collapse.The mixed regression method is used to study the relationship between the interest rate liberalization and the risk of stock price collapse,which is divided by the degree of Finance and by the ultimate controller type.The replacement of stock price collapse risk measurement index,the random effect regression of panel data and the method to test the effect of deregulation policy of interest rate are used to test its robustness.The results show that:(1)interest rate marketization has a negative impact on the risk of stock price collapse,which is still significant after excluding the samples of subprime mortgage crisis and European debt crisis;(2)according to the degree of financialization,the effect of interest rate marketization on the risk of stock price collapse of enterprises with a lower degree of financialization is more obvious than that of enterprises with a higher degree of financialization,indicating that enterprises are over funded Melting weakens the effect of interest rate marketization on the risk mitigation of stock price collapse of real enterprises;(3)from the perspective of ultimate controller type,the effect of interest rate marketization on the risk mitigation of stock price collapse of state-owned holding enterprises is stronger than that of private holding enterprises.In the robustness test,the test of the effect of deregulation of interest rate also shows that both the deregulation of the lower limit of loan interest rate and the deregulation of the upper limit of deposit interest rate can significantly reduce the risk of stock price collapse.