Abstract Based on the data of China’s listed companies from 2008 to 2019, this paper regards “the Belt and Road” Initiative as a quasi-natural experiment and uses the double difference method ( DID ) to investigate the impact of “the Belt and Road” Initiative on the investment-cash flow sensitivity of enterprises. The result shows that “the Belt and Road” Initiative can significantly reduce the investment-cash flow sensitivity of the supported firms. And this conclusion remains robust after adopting the placebo test and robustness test, and the degree of influence is related to the financial flexibility of the enterprise. Further study has found “the Belt and the Road” Initiative can correct over investment and alleviate the contradiction between clients and agents, which constitutes the external governance mechanism of enterprises with weak internal governance. The conclusion of this paper shows that “the Belt and the Road” initiative is an important variable to study financing constraints, financial flexibility and investment-cash flow sensitivity which has been ignored by the existing literature, so as to expand and enrich the research that institutional environment affects financial constraints.
CAO Yunchun,SUN Jian. “The Belt and Road” Initiative, Financial Flexibility and Enterprise Investment-Cash Flow Sensitivity. Economic Survey, 2022, 39(1): 0108.
2022, Vol. 39 
