Financial Constraints, Marketing Capability and Corporate Investment

Abstract

Abstract:

Corporate financial constraints caused by market incompleteness and information asymmetry have received researchers' attention. However, few study concerns the impact of financial constraints on corporate investment from marketing perspective. Using the sample of Chinese manufacturing enterprises database, this paper examines the moderating effect of marketing capability on financial constraints and corporate investment relationship in distinctive conditions. The regression results show that marketing capability can significantly moderate the negative impact of corporate financial constraints on corporate investment. Firms can enhance their marketing capability to establish positive relationships with collaborators on the supply chain in order to increase the possibility to access commercial credit and reduce their dependence on credit funds. Marketing capability can also help firms to enhance their brand value and market position to improve the evaluation of investors and banks, thus increasing credit access. Further analysis shows that in the region with high degree of marketization and low degree of financial development, and in highly competitive industries, the high marketing capability has greater impact on financing constraints and investment relationship. A series of robustness tests do not deny the above conclusion.

Key words: marketing capability, financial constraints, corporate investment

Gu Leilei, Guo Guoqing, Peng Yuchao. Financial Constraints, Marketing Capability and Corporate Investment[J]. , 2018, 30(7): 100-113.

References

[1] Fazzari S. M., Hubbard R. G., Petersen B. C., et al. Financing Constraints and Corporate Investment[J]. Brookings Papers on Economic Activity, 1988,1:141-206
[2] Claessens S., Tzioumis K. Measuring Firms' Access to Finance[R]. Mimeo, World Bank, 2006
[3] Brown J. R., Martinsson G., Petersen B. C. Do Financing Constraints Matter for R&D?[J]. European Economic Review, 2012, 56(8):1512-1529
[4] Schroth E., Szalay D. Cash Breeds Success:The Role of Financing Constraints in Patent Races[J]. Review of Finance, 2010,14(1):73-118
[5] Banerjee A. V., Duflo E. Reputation Effects and the Limits of Contracting:A Study of the Indian Software Industry[J]. The Quar-terly Journal of Economics, 2000,115(3):989-1017
[6] Guariglia A., Mateut S. Inventory Investment, Global Engagement, and Financial Constraints in the UK:Evidence from Micro Da-ta[J]. Journal of Macroeconomics, 2010,32(1):239-250
[7] 刘欢,邓路,廖明情. 公司的市场地位会影响商业信用规模吗?[J]. 系统工程理论与实践, 2015,35(12):3119-3134
[8] Fabbri D., Klapper L. F. Market Power and the Matching of Trade Credit Terms[R]. World Bank Policy Research Working Paper Series, 2008
[9] 邓可斌,曾海舰. 中国企业的融资约束:特征现象与成因检验[J]. 经济研究, 2014,49(2):47-60
[10] Beck T., Levine R., Loayza N. Finance and the Sources of Growth[J]. Journal of Financial Economics, 2000,58(1):261-300
[11] 卢峰,姚洋. 金融压抑下的法治、金融发展和经济增长[J]. 中国社会科学, 2004,(1):42-55
[12] Faccio M. Politically Connected Firms[J]. The American Economic Review, 2006,96(1):369-386
[13] 何韧,刘兵勇,王婧婧. 银企关系、制度环境与中小微企业信贷可得性[J]. 金融研究, 2012,(11):103-115
[14] Boot A. W. A., Thakor A. V. Moral Hazard and Secured Lending in an Infinitely Repeated Credit Market Game[J]. International Economic Review, 1994,35(4):899-920
[15] Petersen M. A., Rajan R. G. The Benefits of Lending Relationships:Evidence from Small Business Data[J]. The Journal of Fi-nance, 1994,49(1):3-37
[16] Bharath S. T., Dahiya S., Saunders A., et al. Lending Relationships and Loan Contract Terms[J]. The Review of Financial Stud-ies, 2011,24(4):1141-1203
[17] 胡旭阳. 民营企业家的政治身份与民营企业的融资便利——以浙江省民营百强企业为例[J]. 管理世界, 2006,(5):107-113
[18] Barney J. Firm Resources and Sustained Competitive Advantage[J]. Journal of Management, 1991,17(1):99-120
[19] Srinivasan S., Hanssens D. Marketing and Firm Value:Metrics, Methods, Findings, and Future Directions[J]. Journal of Mar-keting Research, 2009,46(3):293-312
[20] Luo X. When Marketing Strategy Fist Meets Wall Street:Marketing Spendings and Firms' Initial Public Offerings[J]. Journal of Marketing, 2008,72(September):98-109
[21] Joshi A., Hanssens D. M. The Direct and Indirect Effects of Advertising Spending on Firm Value[J]. Journal of Marketing, 2010,74(1):20-33
[22] Fornell C., Morgeson F. V., Hult G. T. M. Stock Returns on Customer Satisfaction Do Beat the Market:Gauging the Effect of a Marketing Intangible[J]. Journal of Marketing, 2016,80(5):92-107
[23] Modigliani F., Miller M. H. The Cost of Capital, Corporation Finance and the Theory of Investment[J]. The American Economic Review, 1958,48(3):261-297
[24] Whited T. M. Debt, Liquidity Constraints, and Corporate Investment:Evidence from Panel Data[J]. Journal of Finance, 1992, 47(4):1425-1460
[25] Kaplan S. N., Zingales L. Do Investment-cash Flow Sensitivities Provide Useful Measures of Financing Constraints?[J]. The Quarterly Journal of Economics, 1997,112(1):169-215
[26] Hadlock C. J., Pierce J. R. New Evidence on Measuring Financial Constraints:Moving Beyond the KZ Index[J]. Review of Financial Studies, 2010,23(5):1909-1940
[27] Vorhies D. W., Morgan N. A. Benchmarking Marketing Capabilities for Sustainable Competitive Advantage[J]. Journal of Mar-keting, 2005,69(1):80-94
[28] Day G. S. The Capabilities of Market-Drive Organizations[J]. Journal of Marketing, 1994,58(4):37-52
[29] Morgan N. A., Slotegraaf R. J., Vorhies D. W. Linking Marketing Capabilities with Profit Growth[J]. International Journal of Research in Marketing, 2009,26(4):284-293
[30] Ramaswami S. N., Srivastava R. K., Bhargava M. Market-based Capabilities and Financial Performance of Firms:Insights into Marketing's Contribution to Firm Value[J]. Journal of the Academy of Marketing Science, 2009,37(2):97-116
[31] Morgan N. A. Marketing and Business Performance[J]. Journal of the Academy of Marketing Science, 2012,40(1):102-119
[32] Keller K. L. Conceptualizing, Measuring, and Managing Customer-based Brand Equity[J]. Journal of Marketing, 1993,57(1):1-22
[33] Barth M. E., Clement M. B., Foster G., et al. Brand Values and Capital Market Valuation[J]. Review of Accounting Studies, 1998,3(1-2):41-68
[34] Madden T. J. Brands Matter:An Empirical Demonstration of the Creation of Shareholder Value Through Branding[J]. Journal of the Academy of Marketing Science, 2006,34(2):224-235
[35] Luo X., De Jong P. J. Does Advertising Spending Really Work? The Intermediate Role of Analysts in the Impact of Advertising on Firm Value[J]. Journal of the Academy of Marketing Science, 2012,40(4):605-624
[36] Luo X., Homburg C., Wieseke J. Customer Satisfaction, Analyst Stock Recommendations, and Firm Value[J]. Journal of Mar-keting Research, 2010,47(6):1041-1058
[37] Ngobo P. V., Casta J. F., Ramond O. Is Customer Satisfaction a Relevant Metric for Financial Analysts?[J]. Journal of the Academy of Marketing Science, 2012,40(3):480-508
[38] Day G. S. Closing the Marketing Capabilities Gap[J]. Journal of Marketing, 2011,75(July):183-195
[39] Mu J. Marketing Capability, Organizational Adaptation and New Product Development Performance[J]. Industrial Marketing Management, 2015,49(August):151-166
[40] Gatignon H., Xuereb J. Strategic Orientation of the Firm and New Product Performance[J]. Journal of Marketing Research, 1997,34(1):77-90
[41] Atuahene-Gima K. The Effects of Centrifugal and Centripetal Forces on Product Development Speed and Quality:How Does Prob-lem Splving Matter?[J]. Academy of Management Journal, 2003,46(3):359-373
[42] De Luca L. M., Atuahene-Gima K. Market Knowledge Dimensions and Cross-functional Collaboration:Examining the Different Routes to Product Innovation Performance[J]. Journal of Marketing, 2007, 71(January):95-112
[43] Morgan R. M., Hunt S. D. The Commitment-Trust Theory of Relationship Marketing[J]. Journal of Marketing, 1994,58(July):20-38
[44] 樊纲,王小鲁,马光荣. 中国市场化进程对经济增长的贡献[J]. 经济研究, 2011,46(9):4-16
[45] Jegadeesh N., Kim J., Krische S. D., et al. Analyzing the Analysts:When Do Recommendations Add Value?[J]. Journal of Fi-nance, 2004,59(3):1083-1124
[46] Martin S. L., Raj R., Javalgi G. Entrepreneurial Orientation, Marketing Capabilities and Performance:The Moderating Role of Competitive Intensity on Latin American International New Ventures[J]. Journal of Business Research, 2016,69(6):2040-2051
[47] Levine R. Financial Development and Economic Growth:Views and Agenda[J]. Journal of Economic Literature, 1997,35(2):688-726
[48] Cihák M., Demirgüç-Kunt A., Feyen E., et al. Financial Development in 205 Economies, 1960 to 2010[J]. Journal of Financial Perspectives, 2013,1(2):17-36
[49] Love I. Financial Development and Financing Constraints:International Evidence from the Structural Investment Model[J]. Re-view of Financial Studies, 2003,16(3):765-791
[50] Fisman R., Love I. Trade Credit, Financial Intermediary Development, and Industry Growth[J]. The Journal of Finance, 2003, 58(1):353-374
[51] 云鹤,胡剑锋,吕品. 金融效率与经济增长[J]. 经济学(季刊), 2012,11(2):595-612
[52] Holmstrom B., Tirole J. Financial Intermediation, Loanable Funds, and the Real Sector[J]. Quarterly Journal of Economics, 1997,112(3):663-691
[53] 张杰,芦哲,郑文平,等. 融资约束、融资渠道与企业R&D投入[J]. 世界经济, 2012,35(10):66-90
[54] Guariglia A., Liu X., Song L. Internal Finance and Growth:Microeconometric Evidence on Chinese Firms[J]. Journal of Devel-opment Economics, 2011,96(1):79-94
[55] Guariglia A., Mateut S. Credit Channel, Trade Credit Channel, and Inventory Investment:Evidence From a Panel of UK Firms[J]. Journal of Banking & Finance, 2006,30(10):2835-2856
[56] Whited T. M., Wu G. Financial Constraints Risk[J]. Review of Financial Studies, 2006,19(2):531-559
[57] 鞠晓生,卢荻,虞义华. 融资约束、营运资本管理与企业创新可持续性[J]. 经济研究, 2013,48(1):4-16
[58] Guariglia A., Yang J. A Balancing Act:Managing Financial Constraints and Agency Costs to Minimize Investment Inefficiency in the Chinese Market[J]. Journal of Corporate Finance, 2016,36(February):111-130
[59] Battese G. E., Coelli T. J. Prediction of Firm-level Technical Efficiencies with a Generalized Frontier Production Function and Panel Data[J]. Journal of Econometrics, 1988,38(3):387-399
[60] Dutta S., Narasimhan O., Rajiv S. Success in High-technology Markets:Is Marketing Capability Critical?[J]. Marketing Sci-ence, 1999,18(4):547-568
[61] Zhang J., Wang L., Wang S. Financial Development and Economic Growth:Recent Evidence from China[J]. Journal of Compar-ative Economics, 2012,40(3):393-412
[62] Mason R. D., Lind D. A., Marchal W. G. Statistical Techniques in Business and Economics-10th ed.[M]. New York:McGraw-Hill, 2012