Zombie Firms and Soft Budget Constraints in the Chinese Stock Market*

IF 1 4区 经济学 Q3 ECONOMICS Asian Economic Journal Pub Date : 2020-06-09 DOI:10.1111/asej.12194
Chenyan Zhang, Yongqiao Chen, Huiyu Zhou
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引用次数: 14

Abstract

The growth of zombie firms has caused increasing concern. The present study seeks to understand why zombie firms have been emerging in recent 10 years and to further explore the mechanisms of their formation. Based on a dataset of Chinese listed companies from 2012 to 2016 and empirical analysis, the present study ascribes the prevalence of zombie firms to soft budget constraints. After using a modified identification model in the Chinese context, we concluded that zombie firms have access to some external resources such as credit support from banks and governmental subsidies, substantiating soft budget constraints among zombie firms. To explain this phenomenon, further analysis reveals that zombie firms bear a heavier policy burden by hiring excess employees, which will bring them more subsidies and a stronger relationship with government in return. This result indicates that policy burden is the reason for soft budget constraints, which exacerbates the zombie firm problems in China.

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僵尸企业与中国股市的软预算约束*
僵尸企业的增长引起了越来越多的关注。本研究旨在理解为什么僵尸企业在近10年出现,并进一步探讨其形成机制。基于2012 - 2016年中国上市公司数据集和实证分析,本文将僵尸企业的盛行归因于软预算约束。采用中国背景下的修正识别模型,我们得出僵尸企业可以获得一些外部资源,如银行信贷支持和政府补贴,从而证实了僵尸企业存在软预算约束。为了解释这一现象,进一步的分析表明,僵尸企业通过雇佣多余的员工来承担更重的政策负担,这将为它们带来更多的补贴,并与政府建立更强的关系。这一结果表明,政策负担是造成软预算约束的原因,这加剧了中国的僵尸企业问题。
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来源期刊
CiteScore
1.50
自引率
7.70%
发文量
19
期刊介绍: The Asian Economic Journal provides detailed coverage of a wide range of topics in economics relating to East Asia, including investigation of current research, international comparisons and country studies. It is a forum for debate amongst theorists, practitioners and researchers and publishes high-quality theoretical, empirical and policy orientated contributions. The Asian Economic Journal facilitates the exchange of information among researchers on a world-wide basis and offers a unique opportunity for economists to keep abreast of research on economics pertaining to East Asia.
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