Abstract: Using a the sample of Chinese A-listed manufacturing companies from 2007 to 2011, this paper investigates whether financial institutions like banks could optimize credit allocation efficiency with their information superiority, easing the financing constraints in the field of technological innovation. It reveals that“credit discrimination”lessens credit allocation efficiency, resulting in valuable financing resources shifting towards some state-owned enterprises (SOEs) lack of technological innovation motivation, which inevitably raising the financing constraints for private listed companies as well as small-scaled companies, consequently diverting technological innovation resources. With improving financial ecological environment and more government policy focusing on technology industry in recent year, the financing facilitations function and capital allocation function of credit market are strengthened, which to some extent, elevates the credit allocation efficiency and relieving the financing constraints of technological innovation.

Key words: cost of debt, financing constraints, technology innovation investment, credit resource allocation efficiency