The Impact Of FDI On The Disposal Of Zombie Firms And Mechanism Of Action

Since the supply-side reform,our country has continuously strengthened the role of the market mechanism in the resource allocation,and has achieved good results in the areas of resolving excess capacity,upgrading the industrial structure,and optimizing the consumption structure.However,at present,the efficiency of resource allocation is low in our country’s capital market,and the problems of "high leverage" and "overcapacity" brought about by rapid economic growth are still very serious.This keeps some low-efficiency enterprises in a "stiff and immortal" state without being eliminated,but these enterprises exacerbate the imbalance between supply and demand in our country.Foreign companies can bring capital,jobs,and development directions and business models that local companies can learn from.They promote industrial adjustment and economic growth in developing countries.However,the existing literature seldom pays attention to the effect of foreign capital inflow on the activation of our country’s stock assets.This article analyzes the market mechanism of foreign capital inflow and its impact on the disposal of zombie companies.This not only provides an incremental empirical basis for the research on zombie companies,but also makes new explorations on the impact of foreign capital inflows.The above has enriched literature on the effects of foreign capital inflows,and has important reference significance for the implementation of the "bring-in" strategy,the rational introduction of foreign capital,and the improvement of resource misallocation.Based on the above background,this thesis conducts research on the impact of foreign capital inflows on the disposal of zombie companies and the impact mechanism.First,this thesis adopts the adjusted FN-CHK method to identify zombie enterprises,and analyzes the status quo of zombie enterprises in our country by region,industry and ownership.Secondly,on the basis of combing and analyzing relevant domestic and foreign literature,analyze the relationship between foreign capital and the resurrection of zombie companies and its influence mechanism from a theoretical level.Then,this thesis uses the panel fixed effect model and the mediating effect model to analyze the relationship between foreign capital and the resurrection of zombie firms and its mechanism of action.The empirical results show that foreign capital inflows can promote the resurrection of zombie companies and have a heterogeneous impact on zombie companies with different property rights and different industries.Foreign capital can significantly promote the resurrection of non-state-owned zombie companies and manufacturing zombie companies,and it accounts for a relatively large proportion of state-owned companies.The positive effects of zombie companies in the mining industry and power,gas,and water production and supply industries are not significant.Finally,through the exploration of the mechanism of foreign investment influencing the resurrection of zombie companies,it is found that the inflow of foreign capital helps companies reduce corporate management costs,increase the export scale,and increase the profitability of zombie companies through channels that promote the resurrection of zombie companies.Based on the above research conclusions,this article proposes corresponding countermeasures and suggestions from three aspects.Firstly,rationally introduce foreign capital.Secondly,deepen the reform of state ownership.Thirdly,optimize enterprise management capabilities.Finally,encourage enterprises to export.