The dilemma of government intervention in a firm's financing: Evidence from China

Fu, Tong

doi:10.1016/j.irfa.2020.101525

Cited by 42 publications

(18 citation statements)

References 54 publications

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“…China’s financial system is underdeveloped [ 29 ]. It comprises the banking and intermediation sector, financial markets, shadow financial sector, and foreign sectors [ 30 ].…”

Section: Institutional Backgroundmentioning

confidence: 99%

Crowding in or crowding out? How local government debt influences corporate innovation for China

Feng

et al. 2021

PLoS ONE

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The pressure upon local governments to redeem their debt could affect government fiscal ability. It could consequently affect their fiscal policies on corporations, which might distort corporate innovation. Based on the data of Chinese Shanghai and Shenzhen A-share listed companies and the local government implicit short-term debt financed by local government financing vehicles (LGFVs) in 31 provinces, this paper shows that local government debt (LGD) negatively affects corporate R&D investment in China, thereby suggesting a strong crowding-out effect. The crowding-out effect is more pronounced when the firm is a non-state-owned enterprise (NSOE), the firm’s size is small, the firm’s age is young, or the firm is in the lower market competition. This paper provide evidence by interacting the terms that local government actions, such as consumption of fiscal resources, strengthening tax collection efforts, or consumption of credit resources, might partially account for the crowding-out effect. This study illustrates the innovation costs of local government debt.

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“…China’s financial system is underdeveloped [ 29 ]. It comprises the banking and intermediation sector, financial markets, shadow financial sector, and foreign sectors [ 30 ].…”

Section: Institutional Backgroundmentioning

confidence: 99%

Crowding in or crowding out? How local government debt influences corporate innovation for China

Feng

et al. 2021

PLoS ONE

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“…Consequently, enterprises supplement capital shortage by applying for government financial support (Adom and Adams 2020) and bank loans (Biswas and Koufopoulos 2019). However, according to Forrester and Reames, even if enterprises apply for government funding or bank loans, their operating costs remain high and their financing efficiencies are not significantly improved (Fu 2020).…”

Section: Theory Developmentmentioning

confidence: 99%

R&D investment and financing efficiency in Chinese environmental protection enterprises: perspectives of COVID-19 and supply chain financial regulation

Sheng

et al. 2020

International Journal of Logistics Research and Applications

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“…Therefore, we cannot use the statistical measure to test the validity of IV. As an alternative method, we try to test the direct effect of our IV on inno according to the mediation method (Sobel, 1982; Feng et al, 2019；Fu, 2020；Fu & Jian, 2021; Fu, 2021).

{inno}_{it} goodbreak= α_{0} goodbreak+ α_{1} \ln {instu}_{it} goodbreak+ β_{1} italicIV goodbreak+ \sum α_{j} X_{jit} goodbreak+ v_{i} goodbreak+ u_{t} goodbreak+ ε_{it}

If the coefficient on IV is significant in Equation , the imperfect exogeneity assumption of IV is violated; otherwise, our IV estimates are robust to the imperfect exogeneity (Conley et al, 2012; Nunn & Wantchekon, 2011).…”

Section: Resultsmentioning

confidence: 99%

Can international students help enhance China's urban innovation?

Wei

Yao

2022

Manage Decis Econ

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The growing number of international students coming to China has injected new vitality into the development of an innovative economy in the mainland. In this paper, we employ a panel fixed‐effect model to examine how international students affect China's technological innovation. Our paper finds that international students in China have significantly promoted urban innovation in China, reflected not only in the expansion of urban innovation scale but also in the improvement of the urban patent structure and innovation quality. This highlights the need to increase the scale of international education and improve the quality of international education.

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The dilemma of government intervention in a firm's financing: Evidence from China

Cited by 42 publications

References 54 publications

Crowding in or crowding out? How local government debt influences corporate innovation for China

Crowding in or crowding out? How local government debt influences corporate innovation for China

R&D investment and financing efficiency in Chinese environmental protection enterprises: perspectives of COVID-19 and supply chain financial regulation

Can international students help enhance China's urban innovation?

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