Local judicial system reform and corporate investment: Evidence from unified management of local courts below the province

Zhao, Renjie; Zhang, Jiakai

doi:10.1016/j.ceqi.2022.11.005

Cited by 10 publications

(6 citation statements)

References 17 publications

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“…These multifaceted elements engender an environment of uncertainty, undermining investor confidence and subsequently exerting a negative influence on financial markets. The recent study conducted by Zhao and Zhang [51] corroborates the conclusions drawn in the present research, who demonstrate that enhancements in the LS positively influences the corporate finance, and financial system. This leads to a reduction in bribery expenditures, and increased investments in productive ventures, thereby fostering concurrent advancements in both the economy and the legal arrangement.…”

Section: Plos Onesupporting

confidence: 91%

The effectiveness of emerging markets’ legal structure in explaining financial development

Anser,

Khan,

Khan

et al. 2024

PLoS ONE

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This article examines the role of legal structure in explaining financial development in twenty-three emerging markets, which has not been explored in institutional economics literature before. This study relied on Pedroni, and Kao cointegration tests, which is followed by the renowned panel cointegration technique. The results of the Pedroni and Kao cointegration tests show that the variables understudy is cointegrated in the long-run. These findings are confirmed by the panel cointegration showing that legal structure (LS) has positive impact on financial development (FIND) in long-run that support Law and Finance, and New Institutional Economics theories in emerging markets. This study is the first to directly examine the long-run impact of LS on FIND in emerging markets, and the result remains consistent across alternative measure of FIND. The findings of this study have important policy implications for emerging markets. Policymakers should focus on creating a legal environment that is conducive to financial development. This includes strengthening the legal framework, improving regulatory regimes, and promoting market autonomy. Additionally, policymakers should work to attract foreign investment, which can help spur economic growth and development in emerging markets. The findings of the study are consistent across battery of robustness testing.

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Section: Plos Onesupporting

confidence: 91%

The effectiveness of emerging markets’ legal structure in explaining financial development

Anser,

Khan,

Khan

et al. 2024

PLoS ONE

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“…Corporate capital expenditure is measured by ‘cash paid for the purchase and construction of fixed assets, intangible assets and other long‐term assets’ in the financial statements, minus ‘cash received from the disposal of fixed assets, intangible assets and other long‐term assets’. Furthermore, we use three proxy variables from the balance sheet to test, following Liu and Mao (2019), Qu et al (2011), Tong and Lu (2005), Yu et al (2014), and Zhao and Zhang (2022). (2) INV2: total fixed assets (log).…”

Section: Resultsmentioning

confidence: 99%

Productivity effects of corporate income tax: Evidence from China

2022

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“…Hence, timely repayment of land mortgages with the income from these projects may be challenging. Land mortgage loan repayments rely mainly on land revenue (Zhang et al 2018). The ratio of land revenue to local fiscal revenue increased from 28.4 per cent in 2002 to 56.9 per cent in 2017, an increase of 28.1 per cent.…”

Section: Impact Of Land Price Fluctuations On Financial Stabilitymentioning

confidence: 99%

“…To meet local government expenditure shortfalls, local authorities are resorting to reserving land for direct mortgage loans, setting up financing platforms and land assets to borrow from banks, and issuing ‘urban investment bonds’. This process is known as the ‘land financing’ model (Fan and Mo 2014; Zhang, Nian and Liu 2018; Mao and Xu, 2019). Meanwhile, land transaction fees are still only enough to repay land mortgage loans and guarantee bond issuance.…”

Section: Introductionmentioning

confidence: 99%

The Impacts of Land and Real Estate Price Fluctuations on Financial Stability: Evidence from China

Wu¹,

Li²,

Yang³

2022

Australian Economic Review

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We construct a provincial financial stability index, and use panel vector autoregression to construct a model for empirical testing. We find that local governments' reliance on land grant premiums amplifies the impact on financial stability. In addition, the relationship between the real estate market and the financial system allows real estate price fluctuations to significantly affect market participants, further impacting financial system stability. Finally, in the eastern region, land price fluctuations have a less adverse impact on financial stability, while in other regions, rising commodity real estate prices are the biggest threat to financial stability.

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Local judicial system reform and corporate investment: Evidence from unified management of local courts below the province

Cited by 10 publications

References 17 publications

The effectiveness of emerging markets’ legal structure in explaining financial development

The effectiveness of emerging markets’ legal structure in explaining financial development

Productivity effects of corporate income tax: Evidence from China

The Impacts of Land and Real Estate Price Fluctuations on Financial Stability: Evidence from China

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