Study on the Impact of Financing Constraints on The Marketization Process

Abstract

In recent years, China has proposed to build a new development pattern with the domestic great cycle as the main body and the domestic and international double cycle promoting each other, and in this context, it explores how to promote the domestic great cycle and build a unified domestic big market from the micro level. This paper selects the data of Chinese A-share listed enterprises from 2011 to 2021 as a sample, studies the relationship between corporate financing constraints and the marketization process, explores the role of the mechanism, puts forward relevant hypotheses and conducts empirical research, and finally conducts the relevant heterogeneity test. It is found that there is a significant negative correlation between corporate financing constraints and the marketization process, in which the characteristics of state-owned enterprises, economically underdeveloped regions, and a higher degree of environmental regulation make the negative relationship stronger, and the conclusion still holds after further testing. The test of the mechanism of action shows that enterprise innovation, enterprise investment and residents' consumption are the three mechanisms through which financing constraints play a role in the marketization process.