A Comparison Of American And Japanese Corporate Financing Mode

After the entry to WTO, the market of China will be fully open to foreign countrys. Facing to the competition of the foreign corporations, it is an unavoidable issue of how improving domestic corporate competitiveness. After continuous exploration since the reform and opening up, institution for domestic corporation and corporate governance is outdated, with the result of widespread inefficiencies and poor innovation of corporations. Therefore, it's necessary to research and analyze domestic corporate financing structure and the large amount of institutional flaw of domestic financial market in order to make out many problems in domestic corporate financing. In this topic, in the way of comparing and analyzing the American, Japanese corporate financing mode, we'll draw lessons from the experience and give advice to improve domestic corporate financing mode.The article include six points in three parts in all for the research:Part One: Relative concept of corporate financing is instructed. The meaning and mutual relation of corporate financing mode, corporate financing sructure and corporate governance are thoroughly introduced. I'll classify the corporate financing method according to different criteria. Then, the relative theory document of corporate financing is retrieved and cited: With the main thread of M-M theory, I'll narrate and analyze Trade-off, Pecking-order, Motivation theory by using Information Economy, Marginal Analysis, Principal-Proxy Model. Conclusion: The essence of corporate financing is to realease the incentive and restrictive effect for better corporate governance, in the way of rationally allocating corporate financing structure. Part Two: Including the third, fourth, fifth point: American, Japanese corporate financing mode will be discussed and compared. This is the core section.In the third and fourth point, respectively the characteristics of American and Japanese corporate financing mode are listed and analyzed: two countrys have huge differences in external financing, except that in either country internal financing is No.1 choice: In America, capital market-dominating mode prevails, which is determined by market-orienting economy and well developed capital market. Due to the specially historical reason, Japan is characterized by government-orienting economy for a long time after Second world war, which result in bank-dominating corporate financing mode. With the choice of America, Japan as the sample, we completely analyze the establishing and developing process of corporate financing mode of two countrys. Tracing the time and environmental variation, the phrase characteristics and development process will be discussed.In the fifth point of paper, from the angle of insititution environment, cost and risk factor, macroeconomic fluctuation, I'll all-round and multi-level compare and research the corporate financing mode, and thoroughly make the objective comment. However capital market-dominating corporate financing mode has merits, such as high effiency in financing, reasonable corporate governance, mature regulations of law; Meanwhile has disadvantages as high price risk, high cost in financing institution, the pursuit of stock-holder's benefit, etc. Bank-dominating corporate financing mode has advantages as low financing cost and the tight relation between bank and corporation, although disadvantages such as a lot of inferior asset to banks due to debt of corporation. Correspondingly the conclusion: corporate financing mode of America and Japan won't be generally commented, with respectively obvious characteristics, both having good and bad aspects, and co-existing and completing with each other. Mixed Mode is an practical method, and an irrevocable development trend. In America, the gap between bank and corporation becomes smaller: corporate governance will be better with the loan. Securities can be mixed in the transaction range of bank's. Institution-investors take into account both speculative and corporate interest in the long run. This is not only the reform of American corporate financing mode, but also the sign of transition to the financial system. In Japan, there is some marks of the loosening of traditional main bank institution: dependence of corporation upon bank is declining. The high-speed development of capital market makes basic contribution to the multi-dimention development of Japanese corporate financing mode.From the angle of evidence, I'll relate the research of theory with analysis of evidence in this section. The paper is represented more clearly and obviously for the citing of data.Part Three: the sixth point, I'll improve and integrate the domestic corporate financing mode with reference to the experience of America and Japan. Research to the history, condition at present and development tendancy is based upon the outcome of comparative analysis before. Domestic economy structure is somewhat monotonous, so do the corporate financing mode: state-owned corporation dominate in the stock market; The low-quality asset in commercial bank is too much; Corporation bond market is not active, etc.The solution to the problems of domestic corporate financing is a huge, comprehensive social project. Regarding to all aspects, we should not only enhance corporate quality, but also need the support and coordination of bank, capital market, government and investors, especially in reinforcement to institutional constraint, framing scientific and overall law system, making sure benefit-related person do by law, and reducing unnecessary waste of rent-seeking fee. Inclusive items in detail: stimulating the reform of state-owned commercial bank; establishing modern institution for domestic corporation; reforming corporate governance; building multi-leveled capital market to solve the monetary demand of the corporations of different type.With the valuble reference to the corporate financing mode of America and Japan, China will pay much less exploratory cost. We're at the preliminary stage of society construction. Objective condition doesn't allow us to reach to the standard of corporate financing mode of either America or Japan. With accelerating pace of the capital market and corporate governance construction, we must depend on the support of bank deposite, and expect to establish an mode mixed with loan and capital market of same importance. But we should never duplicate the corporate financing mode of either. We should take down-to-earth actions to solve the real dilemma, adjust to the objective tendancy in order to establish a reasonable, effiencient corporate financing mode at our best , and accomplish the goal on the premises of right direction.