试述OrderAnalysis试述of试述Pecking试述Order试述Theory试述on试述Chinese试述Listed试述Companies研究生

论文导读：ydidnotshowahighdegreeofcorrelationinChina’scapitalmarket，whichleadstothepreferenceofusingequity.Besides，therearesomeotherreasons：lowcostofissuingequity，ineffectivefinancialmanagement，immaturityofcapitalmarket，notwelldevelopedbondmarket，andlackofaneff
Abstract：This study tests the order of firms’ financing choices based on a sample consists of 150 Chinese listed companies. And it indicates that China’s listed companies did not follow the theoretical ‘Pecking Order’ （Myers，1984）， but a ‘new order’— internal fund， equity， and debt — to make their financial choices. This is because firm’s gearing ratio and solvency did not show a high degree of correlation in China’s capital market， which leads to the preference of using equity. Besides， there are some other reasons： low cost of issuing equity， ineffective financial management， immaturity of capital market， not well developed bond market， and lack of an effective credit rating system。
Keywords：Analysis Theory Chinese Listed Companies
Myers（1984） put forward ‘Pecking Order Theory’ in his master piece “The Capital Puzzle”. And he argued that there was no optimal debt ratio existing. Instead， firms might seek financing because of the asymmetric information and agency cost following a hierarchical order： internal funds， debt financing， and then equity financing. As a result， according to Myers and Majluf （1984）， managers may reject some lucrative but risky projects， if they need to finance through risky ways. Finally， the hierarchical order is practical， just as Gracia and Sogorb（2008） said， “…This order is led by the financial sources that are least subject to information costs and at the same time involve less risk. Internally generated funds are the preferred source of financing， followed by low-risk short-term debt and then higher-risk long-term debt. The last option is new capital， which is the source of financing with the highest information costs…”
According to some former researches on China’s listed companies， there are two main vie论文导读：n（2005）setupthreemodelstotestthetheory.TheirfindingssupportedthetheoryanddemonstratedaconventionalmodelofcorporatecapitalstructurewhichcanexplainthefinancingbehiourofChinesecompanies.Moreover，theresearchofFuandQu（2007）supportthetheorybyemployingOrder-p
ws about situations in China.
Tong and Green （2005） set up three models to test the theory. Their findings supported the theory and demonstrated a conventional model of corporate capital structure which can explain the financing behiour of Chinese companies. Moreover， the research of Fu and Qu （2007） support the theory by employing Order-probit model to analyse the financing order of Chinese listed companies. However， there are also some researches showing controversial conclusions. Chen （2004） indicate源于：论文www.7ctime.com
d that Chinese firms did not follow the pecking order， yet prefer issuing equity in all circumstance as long as it is authorised by regulator due to the low cost of equity in China.
In this study， 150 companies are randomly chosen from China’s top 500 listed companies of 2012， which are ranked by FORTUNE China， to make up the sample set. And their financial data in the period from 2006 to 2012 was employed to fulfil the research. In order to simplify the empirical analysis， the gearing level（LTA） is employed to measure the leverage of the firm， which is set to be the dependent variable. And Current or Liquidity Ratio （LiR）， Monetary Assets Ratio （MAR）， Operating Cash flow and Liabilities Ratio （OCLR）， and Operating Cash flow per Share （OCS） are considered as explanatory variables. And all data of the variables are measured in book-value base， because book values are more reliable than market value considering the high ratio of shares which are still held by the state and the volatility of Chinese stock market （Huang and Song， 2002）.
→Hypothesis 1： A po论文导读：blems.Moreover，Pvaluesofthet-testandF-testshowsthiodelhasaplausibleexplanatorypower.Meanwhile，AdjustR-squaredshowsthefitnessofthemodelisveryhigh.TheregressioncoefficientsofLiR，OCLR，MAR，andOCSare-0.1849，-0.4526，+0.1488，and+0.0249，respectively.Theseco
sitive correlation exists between LiR and LTA.
→Hypothesis 2： A源于：论文格式标准www.7ctime.com
positive correlation exists between MAR and LTA.
→Hypothesis 3： A positive correlation exists between OCLR and LTA.
→Hypothesis 4： A positive correlation exists between OCS and LTA
According to the liner analysis between dependent factor and explanatory factors， a linear regression model can be feasible enough to detect their relationship， which is defined as follow：
Correlation Test of variables indicates all these variables will not lead to significant multi-colinearity problems. Moreover， P values of the t-test and F-test shows this model has a plausible explanatory power. Meanwhile， Adjust R-squared shows the fitness of the model is very high.
The regression coefficients of LiR， OCLR， MAR， and OCS are -0.1849， -0.4526， +0.1488， and +0.0249， respectively. These coefficients show that both LiR and OCLR are significantly and negatively correlated to LTA， whereas， MAR and OCS he positive correlations with LTA， which proves the hypotheses.
The results stated that， firm’s gearing ratio and the solvency do not show a high degree of correlation in China’s capital market， that is， when external financing is needed， China’s listed companies do not tend to use debt financing， even though they he ability to raise money by debt. As a result， China’s quoted companies prefer to raising money through equity， rather than using debt financing.
Based on the discussion above， there is a new “Pecking Order” among Chinese listed companies to follow to finance， namely， （1） internal financing； （2） equity financing； （3） debt financing.
This result has been noted by several scholars， for example Chen （2004） found Chinese listed companies followed a ‘new Pecking order’， which is same with the论文导读：ingdebt.TheresultsofthisstudyclearlyprovedthattherearesevereagentconflictsproblemsexistingamongChina’slistedcompanies，asaresult，shareholdervaluemaximizationcannotbeachieved.Tosumup，inChina’arket，listedcompaniesdonottakefullyuseofthefinanciallevera
result of this study， to make their capital choice decisions. And she argued that fundamental institutional difference between western countries and China， such as the corporate governance structure of the listed firms； financial constraints in financial services sector； and agency problems are the reasons for the ‘new Pecking Order’. Besides the above factors， that the state government is the principal stakeholder of firms and the owner of banks also affects firms’ financing behiours to a large extent. According to Berle and Means （1932）， good fluidity of fund and solvency will stimulate firm to use debt financing. And when using debt to raise fund， the managers of the firm can gain mostly Residual Claims， which can boost managers’ initiative， cut supervising costs and agent costs， and increase efficiency （Jensen and Meckling， 1976； Grosan and Hart， 1986）. However， the results of this study show that， in China’s capital market， fluidity of fund and solvency do not effectively influence firm’s financing decision of issuing debt. The results of this study clearly proved that there are severe agent conflicts problems existing among China’s listed companies， as a result， shareholder value maximization cannot be achieved.
To sum up， in China’s market， listed companies do not take fully use of the financial leverage to maximize the shareholders wealth， but prefer to raising money by means of issuing shares. According to Myers and Majluf （1984）， it is irrational because the cost of equity is much higher than the cost of debt. And论文导读：ina’scapitalmarketfro上一页123456下一页
also， issuing equity may send bad signal to outside investors， because they believe that firms seek to issue securities only when they are over-priced or firms are unable to raise money through other low-cost ways.
Based on the analysis of this study and previous literatures， the reasons leads to this result can be summarised as following：
1， the cost of equity is very all in China
The high level of the price earnings ratio （PE ratio） is the main factor that leads to low cost of equity in China’s market. Besides， low dividend distribution rate is another factor.
2， China’s capital market is a developing market. Compared with that of the western countries， it still has many immature characteristics. There are three typical characteristics of the market in China， （1） capital market in China is faultiness， which is significantly subject to government interposition irregularly； （2） institutional uncertainty is very common； （3） banking system is fragile （Ton摘自：毕业论文格式设置www.7ctime.com
g and Green， 2005）.
3， financial management is inefficient among Chinese quoted companies.
Most of China’s quoted companies are modified from state-owned firms in the past 10 to 30 years. And most of them are still in control by the government. The financial management systems of these companies are not well developed.
4， bond market in China is not developed.
Credits of firms are very low， which makes investors not interested in investing in firms’ bonds. As a result， the cost of debt is relatively higher than that of western countries.
5， China’s market lacks an effective credit rating system， which means there is no limitation for firms to issue securities， and makes companies willing to use equity financing.
There are clearly some significant changes in China’s capital market fro论文导读：myeartoyear，suggestingthatfurtherworkisneeded，particularlytoinvestigatemorespecificfinancingbehioursindifferentindustriesordifferentlocations.上一页123456
m year to year， suggesting that further work is needed， particularly to investigate more specific financing behiours in different industries or different locations.