Whether The Reform Of The Security Interest System Has Improved The Dilemma Of "Difficult And Expensive Financing" Of Private Enterprises

Since entering the new era,the General Secretary has mentioned at many important meetings that we should support the development of private economy and always adhere to the basic economic system from a strategic perspective.This is not only because the practice of 40 years of reform and opening up has proved that private enterprises,as the main body of the market economy,have made great contributions to the development of China’s characteristic economy.And it is because the basic economic system of our country is in line with the universal law of human society development that Marx expounded that "productive forces determine the relations of production,and the relations of production must be suitable for the conditions of productive forces".However,"difficult and expensive financing" has always been an important obstacle to the development of China’s private economy.The reasons for this situation are related to the deficiencies in adhering to and improving China’s basic economic system in the primary stage of socialism,and in establishing and improving the modern property rights system.In this context,China,as a country with legal economy,how to promote the reform of relevant legal systems to help private enterprises solve the problem of "difficult and expensive financing",and then promote financial development and economic growth is worth studying.In the reform of the legal system,the Property Law issued in 2007,as a landmark law in the reform of the real right of security system,is of more important research significance on its impact on the "financing difficulty and expensive" of private enterprises.Based on this,this paper studies the impact of the reform of the security property right system represented by the promulgation of the Property Law on the total liabilities and debt financing costs of private enterprises,in order to answer whether the reform of the legal system has effectively improved the dilemma of "difficult and expensive financing" of private enterprises.in order to answer whether the reform of the legal system has effectively improved the plight of private enterprises of "difficult and expensive financing".First,by combing the literature on the factors affecting corporate debt financing and debt financing costs,two theories related to this study are determined: information asymmetry theory and principal-agent theory,which lays a theoretical foundation for this study.Secondly,it makes a theoretical analysis of the impact of the reform of the security interest system on corporate debt financing and debt financing costs,and makes corresponding theoretical assumptions based on economic intuition.Then,according to the research problems,the research design of this paper is carried out,which determines that this paper uses the data of private listed enterprises,takes the promulgation of the Property Law as a quasi natural experiment,creatively constructs a control group and an experimental group from the perspective of business risk,the difference method is used to identify the impact of the reform of security property right system on the total liabilities and debt financing costs of private enterprises.Finally,the paper empirically tests the impact of the reform of security property right system on the total liabilities and debt financing costs of private enterprises by using the constructed differential model,and further a simple study is made on what role the reform of the security interest system will have on the operating efficiency of enterprises.Through the empirical research results of the difference model constructed,this paper finds that after the reform of the security property right system represented by the promulation of the Property Law,the total liabilities of private enterprises with a high proportion of business risk increase significantly compared with those with a low proportion of business risk.Further study also found that after the reform of the security interest system,the debt financing cost of enterprises has not decreased,but has increased significantly.This phenomenon is because the relief effect of the reform of the security interest system on the information asymmetry is mostly in improving the financing capacity of enterprises,while the increase of total liabilities will aggravate the opportunistic risk speculation behavior of enterprises,This opportunistic behavior will make creditors,in order to protect their own interests from being infringed,often require higher risk premiums to compensate,thus increasing the debt financing costs of enterprises.However,the investment level and profit level of enterprises do not decrease because of the increase of corporate debt financing cost.On the contrary,they all improved dramatically.In addition,in order to increase the credibility of the empirical test results,this paper has made a relevant robustness test.Specifically,first,through the placebo test method of the random fictitious treatment group,to test whether the results of total liabilities and debt financing costs may be affected by other policies or random factors;Second,through the test method of narrowing the time window,we can test whether the result of total liabilities may be caused by other events after the reform of the security interest system;Third,by replacing the total debt and debt financing cost indicators,the robustness test is carried out.The results of these robustness tests further confirm that the research results in this paper have a certain robustness.At the end of this paper,the conclusions and policy recommendations of the study are given: First of all,it is clear that the reform of the security property right system represented by the Property Law does play a positive role in easing the financing constraints of private enterprises,thus providing empirical support for the improvement of the relevant property rights and creditor’s rights systems and promoting the construction of the socialist legal economic system.Secondly,it is believed that the reform of real right system with the content of "strengthening the protection of real right,expanding the scope of real right for security,and optimizing the establishment and realization procedures of real right for security" should become an important part of the next step of real right security system reform.Finally,this paper believes that the evidence that the level of investment and profitability of enterprises have been significantly improved after the reform of the security interest system also provides important reference for many emerging market countries to further improve the relevant legal system to improve the business efficiency of enterprises to promote economic development.