The Influence of Industrial Policy on the Capital Benefit of Enterprises with Heterogeneous Property Rights

Abstract

Industrial policy, as the sum of various national systems to intervene in the formation and development of industries, on the one hand, can provide more credit and financial resources for enterprise development. On the other hand, it may also aggravate financial misallocations and fiscal misallocations, leading to market failures. From the perspective of the heterogeneity of property rights, this paper analyzes the impact of industrial policies on corporate capital benefit using Chinese industrial enterprises’ data from 2001 to 2013. It explores whether industrial systems affect corporate capital benefit through financial resource allocation and fiscal resource allocation. The empirical findings: industrial policies will significantly reduce the capital benefit of enterprises. The intermediary path through which industrial policy negatively affects corporate capital benefit is different between state-owned enterprises and private enterprises. In state-owned enterprises, it is mainly caused by the negative intermediary effect of financial resource mismatch, and the intermediary result of financial resource mismatch does not exist; in private enterprises, it is mainly caused by the negative intermediary impact of fiscal resource misallocation and exceeds the positive intermediary effect of financial resource misallocation