Financial Constraints And Upgrading Enterprise's Position In Global Value Chain

With globalization of world economy,does bigger export trade scale means higher position in global value chain?Firstly,this paper give a literature review about the development of global value chain theory,the measure of position in global value chain,the relationship between global value chain and value-added trade ratio,financial constraints,the relationship between financial constraints and export.Then,Using a group of panel data of Chinese export enterprises from 2001 to 2007 to analyze different types of export enterprises' financial constraints and the trend of value-added trade ratio.At the end,by constructing financial constrains indicators which include information from internal funds,credit criteria,and trade debit,we investigate the relationship between value-added trade ratio and financial constraints.Based on the literature review,by using different methods to measure the value-added trade ratio for processing trade enterprises General trade enterprises.For financial constraints,by using the ratio of cash to total asset for internal financial constraints index,by using the ratio of interests to fixed asset for external financial constraints index,by using the ratio of account receivable to revenues for commercial credit constraints index.Theory and empirical analysis indicate that financial constrains is the key factor which restrains value-added trade ratio.The improvement of financing conditions and financing capability will increase value-added trade ratio effectively.The increase of internal cash flow can improve foreign-funded enterprises' and private enterprises' value-added trade ratio significantly in processing trade enterprises,while it proves only Private Enterprises' value-added trade ratio significantly in General trade enterprises.The impact of financing conditions is different in different scale enterprises.Compared to small enterprises,large and medium-sized enterprises are more sensitive to internal financing constraints.In addition,subsidies decrease value-added trade ratio rather than increasing it.