The belt and road initiative and the executive compensation contract: evidence from Chinese security market

Wu, Sha; Yue-hua, Jiao

doi:10.1080/13504851.2021.1937493

Cited by 4 publications

(4 citation statements)

References 11 publications

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“…Existing studies on the economic effects of the BRI mainly focus on the macro level, including national economic effects (Fallon, 2015 [9]; Huang, 2016 [10], Wu and Jiao, 2021 [1]), trade potential (Huang et.al. 2020) [8], financing needs (Lai et.al.…”

Section: Theoretical Mechanism and Literature Reviewmentioning

confidence: 99%

“…2020) [12], environmental degradation (Zhuo and Md 2022) [13], settle investment disputes (Mark 2021) [14], etc. The literature at the micro level mainly includes that the BRI promotes Chinese enterprises to, improve the effectiveness of executive compensation contract (Wu and Jiao 2021) [1], and impacts on environment and natural resource (Tian et.al. 2019) [3].…”

Section: Theoretical Mechanism and Literature Reviewmentioning

confidence: 99%

“…Following the research of Chang et al (2014) [26] to define the difference between the actual debt ratio and the target debt ratio of the company to measure the level of excess debt. This paper uses model (1) to perform annual Tobit regression on the sample to predict the target debt ratio of the enterprise:…”

Section: Measuring Corporate Over-indebtednessmentioning

confidence: 99%

“…Therefore, will the implementation of the BRI have an impact on microenterprises? The existing literature on the impact of the BRI on micro-enterprises mainly focuses on corporate executive compensation contract [1], corporate financing [2], corporate social responsibility [3] and corporate performance [4]. With the support of the government and financial institutions, the BRI has stimulated the motivation of Chinese enterprises to invest and open up abroad, and the competition and living environment of enterprises have changed accordingly.…”

Section: Introductionmentioning

confidence: 99%

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The Impact of the Belt and Road Initiative on Corporate Excessive Debt Mechanism: Evidence from Difference-in-Difference Equation Model

Khan

Zhang

et al. 2022

Sustainability

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This paper uses the difference in difference (DID) model to explore the impact of the “Belt and Road” Initiative (BRI) on the level of corporate debt and its mechanism based on quasi-natural experiment of the promulgation and implementation. The results indicate that the excessive debt level of enterprises has a hump trend after the implementation of the BRI. The excessive debt level of enterprises shows a hump trend—that is, although the excessive debt level of enterprises in the initial stage of the implementation of the BRI increases to a certain extent, showing a significant downward trend in the middle and later stages. By using the placebo test and DID propensity score matching model to alleviate the possible endogeneity problem, the above conclusion is still robust. The mechanism analysis shows that: during the implementation of the BRI, the government, and financial institutions have increased tax support for companies participating in the BRI, expanded corporate financing sources, reduce corporate financing costs, and increase companies’ demand for funds. As a result, the level of corporate debt has been increases. The conclusions of this paper not only provide micro-evidence for the interaction between the BRI and the micro-behavior of enterprises, but also have certain implications for evaluating the implementation effect of the BRI and subsequent reforms and refuting the “debt trap” of the “Belt and Road” construction from a microscopic perspective.

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Section: Theoretical Mechanism and Literature Reviewmentioning

confidence: 99%