TITLE:
Impact of Accelerated Depreciation of Fixed Assets Policy on Corporate Financing Behavior—Based on DID, the Empirical Analysis of the Model
AUTHORS:
Danfeng Liao
KEYWORDS:
Accelerated Depreciation, Financing, Difference-in-Difference, Manufacturing Industry
JOURNAL NAME:
Modern Economy,
Vol.7 No.9,
August
25,
2016
ABSTRACT: For the manufacturing industry transformation and upgrading, the policy
implementation of accelerated depreciation of fixed assets has an important
influence. Through the choice of Listed Companies in Shanghai and Shenzhen
financial data, we use the difference-in-difference model to verify the hypothesis.
From the micro level of enterprises, we analyze how the fixed assets accelerated
depreciation policy influences the corporate financing behavior. The study finds
that the financing behavior is significantly influenced by the policy, and can
effectively stimulate “cash flow” of enterprises and reduce the proportion of
debt financing. And it is also conducive for the manufacturing industry to
reduce the cost of capital and optimize the industrial structure. This paper
supports the implementation of the policy, and provides a basis for the tax
reform of depreciation policy.