Study On China’s Corporate Debt Financing Based On Financial Development

Enterprises financing directly affects enterprise performance and long-term development. As the economic development level is not high and the capital market still needs to be improved in China, most enterprises just focus on equity financing instead of debt financing. Now China is in the economic transition period, with financial market gradually optimized, listed companies need to rethink the profound meaning of equity financing and debt financing and adjust the capital structure properly, instead of blindly pursue the equity financing.Based on the above background, this article selects financial development data and listed companies financial data from1998to2012, along with financial development scale, financial development structure, financial development efficiency as financial development indicators and enterprises mortgage assets, enterprise growth, enterprise profitability as three control variables to build time series model. And then we use unit root test and Johansen cointegration test to make empirical analysis on the influence of financial development to our enterprise debt financing, and try to answer whether financial development can alleviate this irrational financing phenomenon in China.The results show that:in the long run, financial development scale, financial structure and financial development efficiency impact debt financing of listed companies in different degrees. Among them, the development of financial structure contributes most. Based on the above empirical research, this article finally puts forward proposals of optimizing financial system from expanding the scale of financial development, development of diversified financial institutions and improvement of the capital operation efficiency.