Empirical Study On The Effects Of Government Subsidy On The Enterprise Value Of Companies Listed On The SME Board

The small and medium-sized enterprise has occupied more than ninety percent of the total amount of China’s modern enterprise, which is the most active and potential economic development in the enterprise group. The important role of small and medium-sized enterprises (SMEs) of our country in the aspects of expanding employment, brisking market, redistributing income, maintaining social stability and improving the structure and layout of the national economy. SMEs have become an important part of the socialist market economic system in China, which plays an irreplaceable role in promoting the economic development of China. Promoting the healthy and sustainable development of the enterprise could enhance the social stability and the improvement of people’s life, SEMs is to maintain stable and healthy development of national economy and social foundation. However, in the process of economic development of our country, the market competitiveness of medium-sized enterprise is weak, facing limited financing channels and other problems in the process of growth. To some extent, these problems have hindered the development of small and medium enterprises. The Chinese government began to introduce various policies and regulations from2003, to promote the development of small and medium-sized enterprises through various means, to improve its market competitiveness. From the "SME Promotion Law" so far, China’s relevant departments have formulated nineteen documents supporting the enterprises. Since the financial crisis, the government even emphasis more on expanding financing channels for small and medium enterprises. An important means to support the small and medium-sized enterprises is government subsidies. The relationship between the government and the enterprise has always been the key areas of research scholars at home and abroad. Foreign scholars mainly from the macro level study the government subsidies the motives of the enterprises. The domestic scholars mainly tend to study government subsidies benefit, and its object of study tend to a particular industry or a comprehensive study of all listing Corporation, less emphasis on small and medium sized enterprise board. So far, there is a little research on small and medium-sized listing Corporation about the government subsidies impact on enterprise value in china. To study and explore whether government subsidies plays an active role in the development of small and medium-sized enterprises, which has important theoretical and practical significance in the new period of economic transition.Based on this background, this paper mainly take small and medium enterprise board as the research object, and the government subsidy effect on enterprise value influence as a point of entry, explain the small and medium-sized listing Corporation government subsidies effect on firm value..The theories of the paper studies are the theory of local government competition theory, the theory of soft budget constraint, fiscal expenditure efficiency theory, the effective market hypothesis theory and signaling theory. With the financial data of all listing Corporation in2007-2011SME board listed as sample, the paper measure the value of the enterprise from two aspects of accounting performance and market performance, using multiple linear regression to analyze the three hypothesis verification is presented in this paper. The empirical results show that:government subsidies of small and medium-sized listing Corporation is positively related to the accounting performance and market performance. According to the actual controllers found in packet inspection, compared to the state-owned enterprises, the government subsidies that non state owned enterprises get can more improve accounting performance significantly. Non state owned enterprise management pay more and enterprise accounting performance related, management will be to maximize the profit as the main goal. But the state-owned enterprises due to the excessive political goals will weaken its pursuit of achievement motivation. Compared to the non state owned enterprises, state-owned enterprises can get government subsidies to enhance the market performance significantly. State owned enterprises access to government subsidies to obtain government resources better, advantageously be market recognition can and this signal, which leads to better market performance.Based on the above analysis, the feasibility of small and medium-sized plate listing Corporation government subsidy policy impact on the enterprise value of the main recommendations through the establishment of relevant laws and regulations, perfect government subsidies and transparent government subsidy system, through fiscal expenditure supervision and the accounting supervision to promote the small and medium-sized enterprise board listing Corporation’s enterprise value, providing strong financial and capital support for the development of small and medium-sized board of listing Corporation, in-situ stress and promote the development of practices. From the theoretical contribution of this perspective, research is mainly focused on small and medium-sized board of listing Corporation which less concerned by domestic scholars, in order to supplement the research of government subsidies benefit. From the practical perspective, analysis helps capital markets for government intervention in resource configuration to provide empirical data, and provide a basis for evaluation of efficiency in the use of fiscal funds. This article doesn’t consider macroeconomic factors within the study period, and the other two means of financial support did not take into consideration, special subsidies and tax expenditures.