Marketization Of Interest Rates,Financing Constraints,and The Level Of Corporate Innovative Investment

With the economic growth rate gradually slows down,China's economic development has entered a new normal.The extensive economic development relying on simple factor inputs in the past is unsustainable,and the source of economic growth must complete the transformation from element-driven and investment-driven to innovation-driven.As the most important microeconomic entity,the innovation intention and innovation intensity of enterprises will directly affect the state of implementation of national innovation-driven strategy.However,the level of independent innovation capability of Chinese enterprises is low,and lags behind the actual needs of economic development for a long time.Technological progress is inherent in the national institutional environment.A good external institutional environment is able to effectively incentivize corporate technological innovation and is also a key guarantee for enhancing the driving force of corporate innovation.The improvement of micro-enterprise innovation capability and the implementation of the national macro-innovation strategy require deepening the reform of the financial system and improving the financial service entity economic system.The interest rate liberalization reform is the supply-side structural reform in the financial sector,and it is the basis for reforming the capital factor price and improving the transmission mechanism of monetary policy.The actual interest rate level determined by market supply and demand is conducive to eliminating distortions in capital prices,guiding capital flows,and promoting the effective distribution of capital.Then,can the continuous promotion of the interest rate marketization reform alleviate the current status of financing constraints faced by corporate innovation and R&D activities? Will the deepening of interest rate liberalization further promote the level of corporate investment in innovation? What is the interaction between innovation financing constraints and the level of investment in innovation? This article attempts to further explore the interaction between interest rate liberalization,corporate innovation and financing constraints,and the level of corporate innovation investment from a micro perspective.This article reviews the entire process of China's interest rate liberalization reform,measures the degree of interest rate liberalization by constructing an interest rate liberalization index,and selects the relevant data for all A-share listed companies in China during the five-year period from 2012 to 2016 as the initial study samples,then constructs empirical models,tests the theoretical hypotheses and draws the following conclusions: First of all,the gradual deepening of interest rate liberalization will help encourage listed companies to carry out innovative R&D,increase their willingness to innovate,and increase the level of their investment in innovation.And we find out that the greater the size of the company,the stronger the willingness to innovate in research and development,and the higher the level of investment in innovation.Firms with higher leverage ratios have lower levels of investment in innovation and are less likely to invest in innovation.Younger companies are more willing to carry out innovative R&D and have higher levels of innovation input.Secondly,the innovative investment activities of listed companies in China are highly dependent on the internal financing of enterprises.There are strong external financing constraints,and the financing constraints have a certain degree of inhibition on the innovative investment of enterprises.Compared with state-owned enterprises,non-state-owned enterprises have higher levels of innovation inputs,stronger corporate vigor,and stronger desire for innovation.However,the financing constraints faced by non-state-owned companies are also more serious.Thirdly,with the continuous advancement of China's interest rate marketization reform,it can alleviate the external financing constraints that companies face,and the degree of dependence on the company's internal cash flow also decreases significantly.Finally,based on the findings of the study,this paper proposes a series of feasibility policy recommendations: First,as for enterprises,they should optimize the corporate governance structure,and raise the level of information disclosure and transparency of innovation information.And they should mitigate the information asymmetry with banks,actively seek financing support,and increase the intensity of R&D investment.Moreover,enterprises should continuously improve the efficiency of innovation,and enhance the core competitiveness of products and technological innovation level.Secondly,as for financial institutions,commercial banks must actively adjust their business strategies,increase their pricing power,formulate and improve a reasonable pricing system.At the same time,efforts will be made to upgrade its core competitiveness,accelerate financial innovation,and adjust business structure and product structure.Based on their development characteristics and advantages,commercial banks should develop distinctive businesses and seek new profit growth points.In terms of innovation and development,banks should actively support corporate innovation and R&D activities,and actively participate in corporate innovation activities.Thirdly,as for government agencies,diversified financial service system and high-efficiency financing platform should be constructed to provide strong support for corporate innovation and development.Furthermore,government agencies should complete the supervision and management system,promote the reform of financial institutions' regulatory policies and internal governance.Moreover,they should optimize the country's macroeconomic structure to ensure the sound operation of the financial system,and maintain the steady development of China's economy.