The Impact Of Financing Constraints On The Chinese Firms' Choice Between Export And OFDI

The development of economic globalization has brought more market choice opportunities and ways to enter the international market.Export and OFDI have become the two most important ways.The new trade theory categorizes the determinants of the choice of heterogeneous firms into the international market as the difference in firm productivity,and believes that the main factor causing this difference is the sunk cost.As the research progressed,scholars began to explore other factors that influence the choice of companies to enter the international market.In this context,as an external environmental factor for corporate survival,the impact of financing constraints on corporate exports and OFDI choices has become one of the important research directions.Although foreign scholars have studied this problem more,few Chinese firms are the research objects,and domestic scholars have less in-depth discussion on this issue from both theoretical and empirical aspects.This paper attempts to draw on the theoretical research results of predecessors,and derives the theoretical model of the choice between OFDI and export under the constraints of financing,and empirically studies the impact of financing constraints on the choice between Chinese enterprises and OFDI.The topic of this paper has important theoretical and practical significance.Focusing on research goals,this paper builds the following research ideas.Firstly,based on the model of Melitz(2003)and drew on Manova(2013)to derive the ideas of financing constraints affecting the exporting theory model of heterogeneous enterprises,and this paper establish a theoretical model for the choice between domestic production and sales,export and OFDI under the constraints of financing.Then,this paper uses the Chinese micro-enterprise data to verify the theoretical model.Finally,based on the conclusions of theoretical and empirical analysis,this paper proposes the corresponding countermeasures.According to the above research ideas,this paper draws the critical conditions for enterprises to enter different markets by deducing the critical productivity level of enterprises in different situations.Then this paper compares the critical productivity levels of firms' exports and OFDI under financing constraints,and derives the factors that influence firms' choice between exports and OFDI.In the aspect of empirical analysis,this paper first tests whether the common financing constraint indicators are applicable to the sample data in this paper.After that,the empirical test analyzes the influence of various influencing factors on the enterprise choice in the theoretical model.The main conclusion of this paper is that the existence of financing constraints does affect the choice of enterprises in domestic survival,export and OFDI.Firms with less financing constraints are more likely to survive,prefer export and OFDI,and tend to be more inclined to OFDI between the two.At the same time,companies are more inclined to use external financing to enter the overseas market.Finally,this paper puts forward some policy recommendations from the enterprise level,financial institution level and government level,that is,the firm reduces the financing cost for itself by managing its own funds and developing financing channels.Financial institutions should change the traditional credit model for firms.To explore overseas financing channels,the government should pay more attention to the financing needs of private enterprises and strive to develop differentiated financing systems for different industries and different enterprises.There are two innovations in this paper.On the one hand,based on Manova(2013),this paper establishes a theoretical model of financing constraints on heterogeneous firms' export and OFDI choices;on the other hand,this paper uses the data of A-share listed companies to focus on the impact of financing constraints on the choice between firms in export and OFDI.