sustainability Article Research on the Impact of Urban Rail Transit on the Financing Constraints of Enterprises from the Perspective of Sustainability Rong Yang 1, *, Linda Yin-nor Tjia 2, * and Matthias Finger 3   Citation: Yang, R.; Tjia, L.Y.-n.; Finger, M. Research on the Impact of Urban Rail Transit on the Financing Constraints of Enterprises from the Perspective of Sustainability. Sustainability 2021, 13, 10543. https://doi.org/10.3390/su131910543 Academic Editors: Zhenhua Chen, Hongchang Li and Roger W. Vickerman Received: 25 August 2021 Accepted: 21 September 2021 Published: 23 September 2021 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). 1 School of Economics and Management, Beijing Jiaotong University, Beijing 100044, China 2 Department of Asian and International Studies, City University of Hong Kong, Hong Kong, China 3 Florence School of Regulation, European University Institute, 50131 Florence, Italy; matthias.finger@eui.eu * Correspondence: 19113058@bjtu.edu.cn(R.Y.); linda.tjia@cityu.edu.hk (L.Y.-n.T.); Tel.: +86-178-0111-2647 (R.Y.) Abstract: Urban rail transit (URT) is closely related to the sustainable development of the city. In addition to the traffic improvements, it also brings social and economic benefits. From the perspective of sustainability, we discuss the effect of urban rail transit on financing constraints of companies listed on the China A-share stock market (A-share, common stocks issued by companies registered in China for domestic institutions, organizations or individuals to subscribe and trade in RMB) and further explore whether the level of financial development has an effect on the above relationship. The results show that: (1) Financing constraints are common among sample enterprises, and the later the opening year of urban rail transit, the greater the degree of financing constraints; (2) The development of urban rail transit is beneficial to alleviate the level of financing constraints of listed companies, and this mitigating effect mainly exists in the samples with high relevance to urban rail transit; (3) The higher the level of financial development, the smaller the degree of corporate financing constraints; (4) Financial development may influence the relationship between financing constraints and urban rail transit. With the improvement of the financial development level, the alleviating effect of urban rail transit on corporate financing constraints is less pronounced. This study gives some references to improve the financing constraints of listed companies and for promoting the sustainable development of urban rail transit. Keywords: urban rail transit; financing constraints; financial development; investment-cash flow sensitivity; A-share listed companies 1. Introduction According to data released by the National Bureau of Statistics of China, by the end of 2020, the urbanization rate of the permanent population in the country exceeded 60%. To meet people’s needs for convenient, fast, and safe travel and to promote sustainable development of urban areas, it is necessary and urgent to invest in the construction of urban rail transit. Urban rail transit systems can be considered as a greener and more sustainable transportation mode than traditional urban transport. The development of urban rail transit is a logical evolution in light of the current challenges. According to the “2020 Annual Statistics and Analysis Report of Urban Rail Transit” issued by the China Association of Metros, as of the end of 2020, 244 urban rail transit operating lines have been opened in 45 cities in mainland China, with a total length of 7978.19 km. 2020 was the last year of the “13th Five-Year Plan”. The length of newly added operating lines that year was 1241.99 km, setting a new record high. It is a fact that the construction of URT can not only effectively alleviate traffic con- gestion [1] and environmental pollution [2], but also promote the overall development of the city. Studies have confirmed the positive influence of urban rail transit on the site Sustainability 2021, 13, 10543. https://doi.org/10.3390/su131910543 https://www.mdpi.com/journal/sustainability