The Mystery Of "Off Real To Fictitiousness" Under Tightening Leverage Constraints

In recent years,investment in non-financial companies have shown the phenomenon of "Off Real To Fictitiousness",which has become an important factor that impedes financial system in good operation and make financial system decoupled from the support of real economy.The mystery of the "Off Real To Fictitiousness" needs urgent explanation.In this paper,we propose that investment substitution effect from non-financial companies is existed indeed,but has limited persuasion.In the tightening leverage constraints of macroeconomic environment,investment of nonfinancial companies will transfer from Industrial Investment to Financial Investment because of leverage changes.We think leverage will further explain the reasons for the financial investment and industrial investment of non-financial corporate financial investment,which helps to solve the problem of "Off Real To Fictitiousness".This paper uses the panel data of all 3000 A-share listed companies(except financial company,petroleum and petrochemical company)from 2007 to 2016 to conduct research and establish an empirical model that includes industrial investment rates,financial investment rates,non-financial corporate leverage,and some control variables.On the basis,we use fixed effects and other methods to verify the model.The research shows that non-financial companies indeed have a substitute effect in the industrial investment rate,but under the condition of tighter leverage,non-financial companies will actively choose the choice affected by industrial investment transfer mechanism,to increase the financial investment rate due to factors such as liquidity preference and achieving long-term business objectives.This has make investment of non-financial companies act as "Off Real To Fictitiousness".Also,we discover that the high leverage accumulated by non-financial companies will have a negative effect on the current industrial investment rate,and if companies choose to reduce their leverage in the current period,they will further exacerbate the "Off Real To Fictitiousness".Non-financial companies can prevent risks from "de-leverage",which will make investment of non-financial companies act as "Off Real To Fictitiousness" and is not conductive to stimulate economic recovery.In addition,the connection between leverage and investment rate of non-financial companies has the industry heterogeneity,which means "de-leverage" need to deal with structural adjustments in leverage,and should consider differences of each industry to push "Off Virtual To Real" so that can reduce the negative impact on economic growth.We propose that,in the "de-leverage" process of non-financial companies,"deleverage" policy can not solve the problem of "Off Real To Fictitiousness".The key to achieve both goals,risk prevention and growth promotion,is to improve the quality of economic growth,adjust the industrial structure,promote industrial transformation and upgrading in order to resolve risks,increase leverage stability and promote economic recovery and growth.