Political Connection Under Private Enterprise Financing Constraints And The Impact Of Research On Enterprise Innovatin Investments

In China under the background of transition of economic system at present, the development of private enterprises not only to promote China’s economic system reform and the establishment of market economic system, at the same time as a real strength has become important social force to promote the Chinese political development, and private enterprise’s the investment capacity of innovation depends on the ability of enterprise internal environment and the use of various social resources, at present, private enterprises are still prevalent problems financing constraints, the financial difficulties will inevitably led to a decline in the investment capacity of innovation, and establish a political connection is the enterprise innovation investment of scarce resources effective channels, according to the statistics of Jiangsu province’s private enterprises and political connection found that about 65% of the companies have a political connection, among them, the entrepreneurs of the National People’s Congress represents or departmental level cadres above the number of accounts for about 20%, the provincial people’s congress or more than was once a place class cadres accounted for about 35%, the number of visible, private entrepreneurs is keen on politics. In this paper, from the new Angle of political connection of listed private enterprises in Jiangsu province demonstration analysis on the influence factors of innovation investment has important theoretical and practical significance.At first, this paper combing the relevant research literature at home and abroad were reviewed systematically, combined with the current Chinese system background, using the information asymmetry theory, enterprise institutional change theory and relevance theory, adopting the research methods of theoretical analysis and empirical analysis, from 2008 to 2013 the empirical data of listed private enterprises in Jiangsu province as samples, with different degree of financing constraints, the enterprise associated impact on enterprise innovation investment has carried on the comprehensive research. First, based on the theory and realistic national conditions in China, respectively from the corporate governance structure and motives seeking to establish to political connection to establish a political connection model, a more precise measure of political connections, and using the method of AHP and panel Logit model more accurately measure the corporate political connections, secondly, using the SA method to measure the degree of financing constraints, to construct the new Euler model assumptions are put forward on the above empirical analysis and robustness testing, finally, on the above empirical analysis, put forward the research content in the end, on the basis of the theory and empirical analysis, draw conclusions and recommendations in full.This paper has drawn the following conclusions through the research and analysis:firstly, the existence of financing constraints, the private enterprise internal cash flow, the more the innovation of the enterprise investment is higher; secondly, the enterprise by the more serious the degree of financing constraints, the innovation of the enterprise investment is lower; Thirdly, the political connection relative to no political connection of enterprises, the innovation of the enterprise investment level is higher, it shows that the political connection role to play in promoting innovation of the enterprise investment. Fourthly, in the presence of different degree of financing constraints, the more severe financing constraints of private enterprise, the more intense they establish political association motives. The conclusion of this article to explain in the presence of financing constraints, have higher political connection of private enterprise innovation investment put forward a new perspective.