تامین مالی و رشد شرکت در چین و هند: شواهدی از بازار سرمایه

This paper studies the extent to which firms in China and India use capital markets to obtain financing and grow. Using new data on domestic and international capital raising and firm performance, it finds that financial market activity has expanded less since the 1990s than aggregate figures suggest. Relatively few firms raise capital and even fewer attract most of the financing. Moreover, firms that issue equity or bonds are different and behave differently from other publicly listed firms. Among other things, they are typically larger and grow faster. The differences between users and nonusers exist before the capital raising, are associated with the probability of raising capital, and become more pronounced afterward. The size distribution of issuing firms shifts more over time than the distribution of those that do not issue, suggesting little convergence in size among listed firms.

One of the most notable developments in the global economy of the past 30 years is the rise of China and India as world economic powers.1 Though they still lag in many respects, their financial systems have developed rapidly.2 After significant reforms and financial liberalization initiated in the early 1990s, their financial systems have become much deeper. For example, stock market capitalization increased from 4 percent of GDP in China and 22 percent in India in 1992 to 80 and 95 percent of GDP in 2010, respectively. By 2010, 2063 firms were listed on China's stock market and 4987 on India's. Moreover, both countries' financial systems have shifted from a mostly bank-based model to one where capital (equity and bond) markets have become more important. Capital markets expanded from 11 percent of the financial system in China and 57 percent in India in 1990–1994 to 53 and 65 percent in 2005–2010.3 In addition, nonbank institutional investors have started to play a more central role, channeling domestic savings and fostering the growth in capital markets.4 This paper studies how much firms in China and India have used this expansion in capital markets to obtain financing and grow. First, it examines the expansion in equity and bond markets over the past two decades and studies whether the growth has meant widespread use of these markets by the financial and nonfinancial private sector. Because financial liberalization enables transactions to occur both domestically and abroad, the paper evaluates the use of domestic and foreign markets. Second, it characterizes which types of firms obtain financing from capital markets. Third, it analyzes whether capital market financing is associated with changes in firm performance. Finally, the paper studies how changes in firm size and growth affect the size distribution of listed firms. To conduct the analysis, a comprehensive dataset was assembled on domestic and international capital raising and performance by Chinese and Indian firms. The focus is on the recurrent use of equity and bond markets among publicly listed firms after their initial public offerings (IPOs).5 The dataset was constructed using transaction-level information on issues of common and preferred equity between 1990 and 2011 and on corporate bond issues between 2000 and 2011 using Thomson Reuters Security Data Corporation (SDC) Platinum database. These data were then matched with Bureau van Dijk Orbis data on balance sheet information for publicly listed companies between 2003 and 2011.6 The matched data cover 2458 firms in China and 4305 in India, of which 1915 and 3428 firms, respectively, did not have any equity or bond issues between 2003 and 2011. Two main features emerge from the analysis. First, the results suggest that the expansion of financing to the private sector in China and India has been much more limited than aggregate data suggest. Though capital raising in equity and bond markets expanded substantially in 2005–2010, it remained small as a percentage of GDP. Moreover, this expansion was not associated with widespread use of capital markets by firms. For example, the amount of capital raised through equity issues in domestic markets doubled in China (from 0.5 to 1.0 percent of GDP a year) between 2000–2004 and 2005–2010, but the number of firms using these markets increased only 20 percent (from 87 to 105 of 1621 listed firms). Similar patterns appear in the use of foreign markets. Not only have few firms used equity and bond markets, even fewer captured the bulk of the financing.7 For instance, the top 10 firms in China and India captured between 43 and 62 percent of the total raised in 2005–2010. Thus capital markets might have not been a significant source of financing across firms—which contrasts with the perception in the literature that equity markets, particularly in India, are well-developed. Second, the paper shows that firms that use equity or bond markets are very different and behave differently from those that do not use these markets. Nonissuing firms in both China and India grew at about the same rate as the overall economy in 2004–2011, while issuing firms grew twice as quickly. Moreover, firms that raise capital are typically larger initially and become even larger than nonissuing firms after raising capital through equity or bonds. Firms grow faster the year before and the year when they raise capital.8 In addition, firms that use capital markets have a longer liability maturity structure and more capital expenditures to start with, and the differences relative to firms that do not use capital markets become more accentuated after they do so. These differences between issuing and nonissuing firms are associated with the probability of raising capital. Furthermore, the evidence on firm size and growth has important implications for the size distribution of listed firms. Quantile regressions show that the distribution of issuing firms is tilted to the right and shifts more to the right over time than the distribution of those that do not issue, suggesting little convergence in size among listed firms. The analysis in this paper contributes to several strands of the literature. First, many studies argue that financial development is associated with economic growth.9 Most of this literature focuses on the size of financial systems by analyzing aggregate measures. This paper adds to this literature by studying the use of capital markets by firms, as well as the dynamics of firms raising capital, relative to a control group of publicly listed firms.10 The findings suggest that equity and bond financing is associated with firm growth and thus shed light on the channels through which financial development and growth are related. Second, China and India have generated significant interest because they do not appear to fit the predictions of the law, finance, and growth literature, according to which more developed legal and financial systems spur growth (Allen et al., 2005, Allen et al., 2007 and Yao and Yueh, 2009). China is the most widely cited counterexample to this literature because it is one of the world's fastest-growing economies and it is not clear which sources of financing propel the growth of its private sector. Private firms might have been able to grow rapidly because of their profitability and abundant cash flows (Guariglia et al., 2011 and Hale and Long, 2011a), as state-owned banks have been perceived to favor state-owned enterprises (Boyreau-Debray and Wei, 2005, Hao, 2006, Linton, 2008 and Cull et al., 2009). Informal financing might also be important (Allen et al., 2005). But a survey suggests that bank financing has spurred firm growth (Ayyagari et al., 2010).11 Evidence indicates that capital market depth is positively and significantly associated with provincial growth, though bank depth usually is not (Hasan et al., 2009). The findings here complement the existing literature and provide evidence on the positive association between use of capital markets and firm performance. Third, a separate strand of the literature studies Gibrat's law, which states that firm size and growth are independent and that the firm size distribution (also known as FSD) is stable over time and approximately log-normal. But this view has been challenged. Though large firms seem to grow independently of their size, including smaller firms in the analysis typically introduces a negative relation between growth and size (Lotti and Santarelli, 2004 and Coad, 2009). Moreover, the distribution of young firms is skewed to the right (most of the mass is on small firms) and the skewness tends to diminish monotonically as firms age and become larger (Cabral and Mata, 2003 and Angelini and Generale, 2008). The findings here suggest that even among publicly listed firms—typically the largest in a country—there is heterogeneity: firms that use capital market financing are larger to start with and grow faster than nonusers. In fact, this paper's results indicate that there is no convergence in firm size. If anything, the distributions seem to diverge. These results seem consistent with the rapid growth of large plants in India (Bollard et al., 2013). Moreover, a misallocation of capital in China and India (Hsieh and Klenow, 2009 and Hsieh and Klenow, 2012) might have kept large, highly productive firms artificially small, which might explain why they grow the most when financing becomes available. Fourth, a related strand of the literature studies financial constraints by analyzing whether measures of financial performance affect firm investments in fixed capital, inventories, and research and development (R&D), among other things. Several papers argue that small firms are more likely to be financially constrained and that these constraints might get relaxed as they grow and countries develop financially.12 Other papers study whether firms in China and India are financially constrained. China's state-owned enterprises seem to have better access to finance and thus seem less financially constrained (Chow and Fung, 1998, Li et al., 2008, Poncet et al., 2010, Guariglia et al., 2011 and Hale and Long, 2011b). In India smaller firms seem more financially constrained (Love and Martinez Peria, 2005 and Oura, 2008). The results here show that new capital market financing is related to higher growth and investment for publicly listed firms. This seems consistent with financial constraints affecting even large, publicly listed firms that are better able to raise capital in formal markets. The paper is organized as follows. Section 2 describes the data. Section 3 analyzes the development of capital markets in China and India and how firms use them to raise capital. Section 4 studies the dynamics of firms around the use of capital markets. Section 5 concludes.

This paper offers new evidence on how much of the expansion in capital markets in China and India has reached different types of firms and to what extent access to these markets has been related to firm performance. The findings suggest that the expansion of financial activity has been much more limited than aggregate numbers on capital market development suggest. In particular, capital market financing has been channeled to relatively few firms and markets have remained highly concentrated, with a small share of firms capturing the bulk of equity and bond financing, domestically and abroad. In other words, capital markets have not been a significant source of financing across listed firms. For the firms that do raise capital in these markets, this funding seems related to firm dynamics. Not only do certain types of firms use capital market financing, but their attributes also become more distinct after raising capital. For example, large firms are the main ones that raise equity and bond capital. Moreover, they grow faster in the years before and during raising capital and become even larger than the control group in the year after, increasing—among other things—their capital expenditures. Furthermore, the firm size distribution shifts more over time for firms that raise capital than for those that do not, suggesting little convergence in size across listed firms. While nonissuing firms grow on average at a rate similar to that of the overall economy, issuing firms grow much faster. The evidence in this paper indicates that financing matters for firms. Even though financial markets in China and India are not yet fully developed, firms that can raise capital seem to benefit from it, particularly in terms of their expansion. In other words, at least part of the high growth in these countries seems to come from the firms able to raise new funds. Nonetheless, even large firms appear somewhat financially constrained. The differentiated performance of users and nonusers of capital market financing suggests that for publicly listed firms, performance is sensitive to the external capital raised. That firms perform differently when they raise capital also suggests that they had ex ante investment opportunities that they could not realize. But testing for the presence of financial constraints requires much more work. Though this paper has shown that capital raising activity is related to firm dynamics, it does not analyze the extent to which these effects are driven by the supply side (capital market side) or the demand side (firm side). It is possible that firms have growth opportunities and simply raise capital in equity and bond markets when they need it—as suggested by the fact that firms grow more rapidly just before raising capital. And some firms might have business opportunities that propel their growth, leading them to seek more capital to sustain new investments. But supply-side effects might also be at work, as fluctuations in financial activity typically have real effects. For example, shocks to global mutual funds seem to affect investment growth rates in China and India (Jotikasthira et al., 2012). Moreover, frictions in the financial system might affect which firms obtain financing, restricting access to capital markets to a few firms (Didier et al., 2013). More work is needed to understand how financial intermediaries affect access to capital markets, because most existing studies focus on banks. Government rules and regulations on domestic and foreign transactions in capital markets (including capital controls) have likely played a role in capital raising activity. In particular, restrictions on companies to issue equity and bonds and for domestic and foreign residents to invest in them might have undermined equity and bond issues in China and bond issues in India. India's equity markets were less affected because they operated more freely in the period analyzed here. Moreover, these restrictions have been relaxed over time. Furthermore, these restrictions are less likely to have affected firm dynamics or their size distribution. But more research is needed in this area. The findings in this paper also have implications for discussions on capital market development and access to finance for corporations. In recent decades many emerging economies have undertaken major efforts to expand the scope and depth of their capital markets and to liberalize their financial sectors to increase the provision of financial services. Moreover, many economists have predicted big changes as China and India further liberalize and develop their financial markets. While these developments will bring important changes, the findings here might help put in perspective their possible effects. Expanding capital markets will tend to directly benefit the largest firms (among already large publicly listed firms). More widespread direct effects might be harder to identify. Furthermore, indirect effects on smaller firms still need to be understood and quantified. For the broader set of emerging economies, the findings here suggest that even in fast-growing China and India, with plenty of growth opportunities, receiving large inflows of foreign capital, and with thousands of firms listed in their stock markets, few firms have engaged in capital market activity. This could suggest that it will be difficult for a broad set of firms from smaller and slower-growing countries to benefit from capital market development. But more work is needed to develop a good benchmark of the number of firms that should receive capital market financing.