The Study Of Influence Of Information Asymmetry To The Cost Of Equity Capital

With the development of capital market,the information is playing a more and more important role in capital operation,especially for the influence of the equity capital cost,critical to the interests of investors and enterprises.This paper mainly studies the direction and quantity that information asymmetry affect equity capital cost.Elucidating the mechanism that information asymmetry impacts the equity capital cost in theory.First of all,introducing the interaction process between market and information and four related economic theories.Then,showing the influence of the two channels from the different angle of view:mechanism based on risk and road based on participants.This paper takes stock non-finance companies from 2010 to 2014 on Shenzhen Stock Exchange as the study samples.We then conduct an empirical analysis on the relation between information asymmetry and equity capital cost.The results show that:the listed company information disclosure quality ratings is negatively related to the equity capital cost,the scale of listed company is negatively related to the equity capital cost,top ten outstanding shareholder ownership is negatively related to the equity capital cost,and indirectly,it is concluded that degree of information asymmetry is positively related to the equity capital cost.At the same time,the influence that B/M and LEV to equity capital cost is same with theoretical analysis.That is to say,the higher B/M and LEV cause higher equity capital cost.But the explanatory power of ? is not significant,reflecting that CAPM model does not explain the returns of domestic risky assets,which is same with some scholars' conclusion.Finally,based on the above research results,the paper give advice and suggestions on how to reduce the degree of information asymmetry?improve financing conditions and optimize capital market environment from three point of views.