Financing Constraints, Risk of Stock Price Crash and Impact of New Crown Pneumonia

Taking Shanghai and Shenzhen A stock listed companies as a sample, this paper uses the event research method to test the effect of financing constraints and stock price crash risk on the cumulative excess return (CAR) of enterprises under the impact of the epidemic situation. The results show that the risk of stock price collapse plays a negative role in the transmission channel of the impact of the new crown epidemic on the enterprise's cumulative excess return, and the financing constraint intensifies the negative effect. Further, the heterogeneity analysis based on firm size and ownership found that in SMEs and non-state-owned enterprises, the effect of increased financing constraints is more significant Is significant. Finally, this paper puts forward some suggestions from the perspective of relevant regulatory departments and enterprises themselves.

The Impact of Cross-Shareholding Networks on Financing Constraints --Empirical Data from Manufacturing Companies

As the financial markets have evolved, the cross-shareholding networks have been formed among Chinese enterprises with equity as the concluded relationship. Exploring the impact of the cross-shareholding networks on financing constraints has important implications for the decisions of manufacturing companies. This paper uses the social network method to characterize the cross-shareholding networks of manufacturing companies from 2007 to 2019 and explores the effects of the cross-shareholding networks on financing constraints. The innovation of this paper is to explore the relationship between the two. It is concluded that the centrality or structural holes richness of manufacturing companies in the cross-shareholding network is inversely related to the financing constraint. The higher the centrality or the richer the number of structural holes, the lower the level of financing constraints.

Determinants of the Financial Constraint and Its Effects on the SME Growth in Central Asia?

This study investigates the firm- and country-specific factors that affect SMEs’ access to finance and the relationship between financial constraint and firm growth in emerging economies of Central Asia. To address the research questions, a two-stage empirical analysis including ordered probit, probit, and feasible generalized least squares (FGLS) specifications were conducted. Firm-level data used in the analysis is obtained from the fifth round of the Business Environment and Enterprise Survey (BEEPS V) and country-level data acquired from national and international datasets. The study's findings implied that in the Central Asian economies, country-specific factors are more likely to affect access to external finance of SMEs than firm-specific determinants. Among firm-specific factors, only foreign ownership is significantly related to financing constraint perception of SMEs; where, the interest rate is positively, and domestic credit market, inflation, and log of GDP per capita are negatively related to financing constraint level. In Central Asia, an insignificant relationship between growth and financing constraints was found. The determinants of financing constraints and access to finance–growth relations, which address the issue of great significance for SME growth in the selected countries, were interpreted with region-specific factors.

Do the Green Credit Guidelines Affect Corporate Green Technology Innovation? Empirical Research from China

Green technology innovation is regarded as an important means to achieve sustainable development. Countries all over the world mainly implement green technology innovation policies from the aspects of environmental regulation and financing constraints. The effect of financing constraint policy on enterprise green technology innovation remains to be investigated. Based on the event of “green credit guidelines” issued by China Banking Regulatory Commission in 2012, this paper collects the panel data of China’s 2825 listed companies from 2007 to 2018, constructs a difference-in-difference model, and studies the impact of green credit guidelines on corporate green technology innovation and its mechanism. The empirical results show: First, green credit guidelines can promote corporate green technology innovation on the whole. Second, the mechanism of green credit on enterprise green technology innovation is identified. Green credit guidelines mainly limited green technology innovation through reducing debt financing, rather than through financing constraints. Third, the impact of green credit guidelines on green technology innovation is heterogeneous. Green credit guidelines have a significant effect on the green technology innovation of state-owned and large enterprises, but have no effect on the green technology innovation of non-state-owned and small ones.

The Financial (In)Stability Real Interest Rate, R**

We introduce the concept of financial stability real interest rate using a macroeconomic banking model with an occasionally binding financing constraint as in Gertler and Kiyotaki (2010). The financial stability interest rate, r**, is the threshold interest rate that triggers the constraint being binding. Increasing imbalances in the financial sector measured by an increase in leverage are accom- panied by a lower threshold that could trigger financial instability events. We also construct a theoretical implied financial condition index and show how it is related to the gap between the natural and financial stability interest rates.

Research on Innovation Signals and Feedbacks between SMEs and the Government

Due to the financing constraint that faced by small and medium-sized enterprises (SMEs), SMEs are more cautious in innovation investments, and thus more eager to gain external financial support. This paper discusses the impact of SMEs’ R&D investment on government subsidy under the constraint of hidden information. It adopts a modified endogenous switching regression model to solve the endogenous problems. The results show that SME’s initiative to signal its underlying innovative capacity has an important impact on Chinese government’s subsidy feedback. SMEs that send high-type signals have gained more subsidies. And when SMEs are with different types of innovation signals, they would have different influence mechanisms on subsidy feedback. This study concludes that the policymakers should make more use of its belief and give effective feedbacks to the entrepreneurs.

FINANCING DEVELOPMENT, FINANCING CONSTRAINT AND R&D INVESTMENT OF STRATEGIC EMERGING INDUSTRIES IN CHINA

Taking listed companies of strategic emerging industries as the research subject, this paper uses KZ index to measure the degrees of financing constraints and financial intermediary as well as the stock market to represent the level of financial development. Then empirical models are constructed to analyse whether financial development can alleviate the financing constraints of R&D investment or not. Finally, the paper further investigates the interaction of financial development and firm characteristics (including firm size, ownership nature and establishment time) on the impact of R&D investment. The results show that the degree of financing constraint is negatively correlated with R&D investment. Both the development of financial intermediary and stock market play an important role in alleviating the R&D financing constraints, and the development of the stock market can better alleviate the R&D financing constraint. Moreover, the development of financial intermediary and stock market plays a heterogeneous role among enterprises of different size, nature and time of establishment. In order to achieve the 13th Five-year Plan target of strategic emerging industries in China, the government and enterprises need to work together to improve the financial development level and reduce information asymmetry, so as to expand the investment channels of R&D investment and improve their innovation capability and competitiveness.