{"title":"Anti-corruption campaign and SOEs innovation: The role of the central inspection group in China","authors":"","doi":"10.1016/j.iref.2024.103544","DOIUrl":null,"url":null,"abstract":"<div><p>Using central inspections of China aimed at SOEs as a quasi-natural experiment, we investigate the causal effect of anti-corruption campaigns on the innovation of state-owned enterprises (SOEs). Based on the sample of China's SOEs, we find that the central inspections lead to an uplift in the quantity of SOE innovation at the expense of innovation quality. Further analysis indicates that owing to the unique motivation of political promotion, SOE managers improve the operation indicators valued by the government when subjected to political intervention in the shape of anti-corruption, such as the innovation quantity, referred to as the political monitoring mechanism. Eventually, there will be a decline in the quality of innovation that will supplement the long-term value of SOEs since the central inspection does not contribute to corporate governance.</p></div>","PeriodicalId":14444,"journal":{"name":"International Review of Economics & Finance","volume":null,"pages":null},"PeriodicalIF":4.8000,"publicationDate":"2024-08-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"International Review of Economics & Finance","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S1059056024005367","RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 0
Abstract
Using central inspections of China aimed at SOEs as a quasi-natural experiment, we investigate the causal effect of anti-corruption campaigns on the innovation of state-owned enterprises (SOEs). Based on the sample of China's SOEs, we find that the central inspections lead to an uplift in the quantity of SOE innovation at the expense of innovation quality. Further analysis indicates that owing to the unique motivation of political promotion, SOE managers improve the operation indicators valued by the government when subjected to political intervention in the shape of anti-corruption, such as the innovation quantity, referred to as the political monitoring mechanism. Eventually, there will be a decline in the quality of innovation that will supplement the long-term value of SOEs since the central inspection does not contribute to corporate governance.
期刊介绍:
The International Review of Economics & Finance (IREF) is a scholarly journal devoted to the publication of high quality theoretical and empirical articles in all areas of international economics, macroeconomics and financial economics. Contributions that facilitate the communications between the real and the financial sectors of the economy are of particular interest.