Financial Constraints、 Traed Credit And Investment

Investment and financing decision has always been hot and key issues in financial studies.-At the imperfect capital market, asymmetric information, agency problems, transaction costs and other factors cause the differences of internal and external corporate financing costs, then the problem of financing constraints appear. The Western signal transmission theory, agency cost theory and empirical studies show that the debt is important to the investment behavior and corporate governance. In the source structure of listed companies in China, Commercial credit liabilities are one of its main ingredients. At home and abroad, many theoretical and empirical studies have shown that commercial credit is an effective way to ease the financial constraints. However, almost all of the studies did not examine the relationship among financing constraints, commercial credit and business investment. Specifically from the perspective of commercial credit, this paper establishes the accelerate investment model and the Euler equation model to examine the relationship among financing constraints, commercial credit and business investment, in order to enrich the investment and financing in this area.This paper first introduces the research background, significance of research ideas, research methods, technical solutions and innovations; Secondly, on the basis of previous studies, review the relationship among financial constraints, commercial credit and corporate investment; Then, on the basis of theoretical analysis, put forward the assumption of this article:commercial credit can ease financing constraints and financing constraints easing improves the business investment. Ultimately, we select China’s A-share listed companies 2006-2011 data of Shanghai and Shenzhen as panel data to study financing constraints, the relationship among commercial credit and business investment.The results show that:(l)Under the full sample regression, investment and operating cash flow was positively correlated, which indicates that investment is sensitive to cash flow. There is a widespread financing constraints in China’s listed companies. Commercial credit and operating cash flow cross coefficient is significantly negative, indicating that commercial credit makes investment reliance on less internal cash flow. Commercial credit eases corporate financing constraints, thus contributing to the corporate investment; (2)The regression results of different sizes show that, different sizes of enterprises have financing constraints. Relative to the big companies, small businesses has higher financing constraints. The use of commercial credit effectively ease the enterprise financing constraints; (3)The regression of different property shows that both state-owned enterprises and non-state-owned enterprises have financing constraints. State-owned enterprises’financing constraint level is slightly higher than the non-state-owned enterprises, the gap is not big. Relative to the state-owned enterprises, non-state-owned enterprises use more trade credit. The use of commercial credit effectively ease the enterprise financing constraints; (4)Under different interest coverage, high interest coverage ratio enterprises basically has no financing constraints, its operating cash regression coefficient is not significant, but low interest coverage ratio enterprises operating cash flows regression coefficient is significantly positive, which indicates that there is a high enterprise financing constraints; cross-term coefficient is significantly negative, which indicates that commercial credit makes investment reduce dependence on internal cash flow, thus easing financing constraints. In this regard, we get a few suggestions to our listed companies and capital markets:improve the efficiency of the operating cash flows of the investment; rational use of commercial credit; improve the capital market.