Pub Date : 2024-12-01DOI: 10.1016/j.ceqi.2024.12.004
Ye Guo , Ruoqi Yao
By using an enhanced enterprise matching approach, we obtained microdata on the supply chain interconnections between small and medium-sized enterprises (SMEs) and listed companies. Our findings suggest that becoming the main counterparties of listed companies can significantly improve the financing capabilities of SMEs through credit enhancement effects and supply chain finance. The credit enhancement effect of accounts receivable increases factoring and bill discounting for upstream SMEs; however, the funds obtained are often absorbed by listed companies through trade credit. SMEs with stronger market power tend to extend less trade credit and secure more loans, resulting in a more efficient structure and optimal amount of funds. These findings offer practical insights for guiding the development of supply chain finance.
{"title":"Supply chain interconnection and SME financing: From the perspective of supply chain finance and trade credit","authors":"Ye Guo , Ruoqi Yao","doi":"10.1016/j.ceqi.2024.12.004","DOIUrl":"10.1016/j.ceqi.2024.12.004","url":null,"abstract":"<div><div>By using an enhanced enterprise matching approach, we obtained microdata on the supply chain interconnections between small and medium-sized enterprises (SMEs) and listed companies. Our findings suggest that becoming the main counterparties of listed companies can significantly improve the financing capabilities of SMEs through credit enhancement effects and supply chain finance. The credit enhancement effect of accounts receivable increases factoring and bill discounting for upstream SMEs; however, the funds obtained are often absorbed by listed companies through trade credit. SMEs with stronger market power tend to extend less trade credit and secure more loans, resulting in a more efficient structure and optimal amount of funds. These findings offer practical insights for guiding the development of supply chain finance.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 4","pages":"Pages 249-265"},"PeriodicalIF":1.9,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143162609","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-01DOI: 10.1016/j.ceqi.2025.02.001
Jie Liu , Kun Xu , Jiarong Li
This paper empirically examines the impact of public development finance on firm innovation using loan data from public development finance institutions. The findings reveal that an increase in the size of loans from these institutions significantly enhances firm R&D investments and outputs, primarily reflected in substantial innovations, particularly in invention patents. The effect of public development finance on innovation varies depending on the nature and technological focus of the firm. Public development finance influences innovation through two main channels: financing constraints, which lower the cost of financing for firms, and infrastructure improvements, which enhance the overall business environment. Additionally, public development finance has a significant positive effect on firm value, driving increased corporate innovation.
{"title":"Public development finance and firm innovation","authors":"Jie Liu , Kun Xu , Jiarong Li","doi":"10.1016/j.ceqi.2025.02.001","DOIUrl":"10.1016/j.ceqi.2025.02.001","url":null,"abstract":"<div><div>This paper empirically examines the impact of public development finance on firm innovation using loan data from public development finance institutions. The findings reveal that an increase in the size of loans from these institutions significantly enhances firm R&D investments and outputs, primarily reflected in substantial innovations, particularly in invention patents. The effect of public development finance on innovation varies depending on the nature and technological focus of the firm. Public development finance influences innovation through two main channels: financing constraints, which lower the cost of financing for firms, and infrastructure improvements, which enhance the overall business environment. Additionally, public development finance has a significant positive effect on firm value, driving increased corporate innovation.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 4","pages":"Pages 266-280"},"PeriodicalIF":1.9,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143420143","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-01DOI: 10.1016/j.ceqi.2024.12.002
Yongbing Chen , Jiawen Hu , Yurui Du , Chaoqun Zhan
We empirically investigate whether employment is affected by foreign direct investment (FDI). Empirical results show that the FDI deregulations promote employment by increasing the job creation rate. In addition to the employment expansion of incumbent firms, the FDI deregulations facilitate the entry of new firms, which also contributes to employment. Furthermore, FDI in upstream industries can promote employment in this industry, and FDI from other regions can promote local employment. Finally, a simple estimate shows that about USD 56,900 is required for each job created.
{"title":"FDI deregulations and employment","authors":"Yongbing Chen , Jiawen Hu , Yurui Du , Chaoqun Zhan","doi":"10.1016/j.ceqi.2024.12.002","DOIUrl":"10.1016/j.ceqi.2024.12.002","url":null,"abstract":"<div><div>We empirically investigate whether employment is affected by foreign direct investment (FDI). Empirical results show that the FDI deregulations promote employment by increasing the job creation rate. In addition to the employment expansion of incumbent firms, the FDI deregulations facilitate the entry of new firms, which also contributes to employment. Furthermore, FDI in upstream industries can promote employment in this industry, and FDI from other regions can promote local employment. Finally, a simple estimate shows that about USD 56,900 is required for each job created.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 4","pages":"Pages 281-292"},"PeriodicalIF":1.9,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143611460","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-09-01DOI: 10.1016/j.ceqi.2024.09.004
Yan Dong, Dingyuan Hu
It has been widely believed that bond spreads are positively correlated with related market risks. However, some studies in China's urban investment bond (UIB) market indicate that an increase in real estate market risks usually narrows UIB spreads. This article focused on such puzzle and introduced a quadratic form regression to detect a U-shaped relationship between housing price volatility and UIB spreads, which confirms that UIB pricing is actually in consistence with the traditional bond theory. We further indicated that spreads of guaranteed UIBs were barely affected by housing price volatility, and fiscal transparency seemed to mitigate such volatility's impact on the issuance costs of UIBs. Those findings not only illuminate ways of mitigating risks in the UIB market in China using market instruments but also have important implications for how local governments around the world can mitigate their debt-related problems.
{"title":"The impact of real estate market risks on the issuance costs of urban investment bonds: Evidence from China","authors":"Yan Dong, Dingyuan Hu","doi":"10.1016/j.ceqi.2024.09.004","DOIUrl":"10.1016/j.ceqi.2024.09.004","url":null,"abstract":"<div><div>It has been widely believed that bond spreads are positively correlated with related market risks. However, some studies in China's urban investment bond (UIB) market indicate that an increase in real estate market risks usually narrows UIB spreads. This article focused on such puzzle and introduced a quadratic form regression to detect a U-shaped relationship between housing price volatility and UIB spreads, which confirms that UIB pricing is actually in consistence with the traditional bond theory. We further indicated that spreads of guaranteed UIBs were barely affected by housing price volatility, and fiscal transparency seemed to mitigate such volatility's impact on the issuance costs of UIBs. Those findings not only illuminate ways of mitigating risks in the UIB market in China using market instruments but also have important implications for how local governments around the world can mitigate their debt-related problems.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 3","pages":"Pages 151-166"},"PeriodicalIF":1.9,"publicationDate":"2024-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142323015","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-09-01DOI: 10.1016/j.ceqi.2024.09.003
Hong Ma , Jingxin Ning
Over the past six years, the Sino-US trade war has not only reshaped the relationship between the world's two largest economies but also profoundly influenced the global economic and trade patterns. This paper reviews the background, process, and implications of the Sino-US trade war, examining its impact on China, the United States, and the broader global trade landscape across various socioeconomic dimensions. We begin by reviewing the development of Sino-US trade relations in the past 20 years. Next we detail the background and evolution of the trade war. We then discuss the economic consequences of the conflict, including the effect of tariff increases on product prices, employment, investment, consumption, and welfare. Finally, we explore the reshaping of supply chains in the aftermath of the trade conflict, and the interaction between trade policies and industrial policies within the context of the Sino-US trade war.
Existing literature indicates that the Sino-US trade war has resulted in significant welfare losses for both countries, with surprisingly little impact on employment. The tariffs have not achieved the intended outcome set by policymakers. Specifically, the additional tariffs imposed by the United States on China have neither effectively addressed trade imbalances nor brought manufacturing jobs back onshore. Our paper offers a new perspective on the complexity of the current international trade conflict.
{"title":"The return of protectionism: Prospects for Sino-US trade relations in the wake of the trade war","authors":"Hong Ma , Jingxin Ning","doi":"10.1016/j.ceqi.2024.09.003","DOIUrl":"10.1016/j.ceqi.2024.09.003","url":null,"abstract":"<div><div>Over the past six years, the Sino-US trade war has not only reshaped the relationship between the world's two largest economies but also profoundly influenced the global economic and trade patterns. This paper reviews the background, process, and implications of the Sino-US trade war, examining its impact on China, the United States, and the broader global trade landscape across various socioeconomic dimensions. We begin by reviewing the development of Sino-US trade relations in the past 20 years. Next we detail the background and evolution of the trade war. We then discuss the economic consequences of the conflict, including the effect of tariff increases on product prices, employment, investment, consumption, and welfare. Finally, we explore the reshaping of supply chains in the aftermath of the trade conflict, and the interaction between trade policies and industrial policies within the context of the Sino-US trade war.</div><div>Existing literature indicates that the Sino-US trade war has resulted in significant welfare losses for both countries, with surprisingly little impact on employment. The tariffs have not achieved the intended outcome set by policymakers. Specifically, the additional tariffs imposed by the United States on China have neither effectively addressed trade imbalances nor brought manufacturing jobs back onshore. Our paper offers a new perspective on the complexity of the current international trade conflict.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 3","pages":"Pages 182-211"},"PeriodicalIF":1.9,"publicationDate":"2024-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142415996","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-09-01DOI: 10.1016/j.ceqi.2024.08.001
Xinxin Ma , Sho Komatsu
This study estimates union wage premiums and analyzes the influence of trade unions on the wage gap between rural migrants and local urban workers in China by employing the Blinder–Oaxaca decomposition method based on national longitudinal survey data from the China Family Panel Studies (2010–2018). The results indicate that the union wage premium among rural migrant workers is greater than that among local urban workers. The disparity in union density widens the wage gap, whereas the difference in union wage premiums narrows the wage gap between the two groups. Moreover, the contribution rate of the former is greater than that of the latter. These results suggest that expanding union coverage among rural migrant workers could effectively contribute to reducing the wage gap.
{"title":"Trade unions and the wage gap between rural migrant and local urban workers in China","authors":"Xinxin Ma , Sho Komatsu","doi":"10.1016/j.ceqi.2024.08.001","DOIUrl":"10.1016/j.ceqi.2024.08.001","url":null,"abstract":"<div><p>This study estimates union wage premiums and analyzes the influence of trade unions on the wage gap between rural migrants and local urban workers in China by employing the Blinder–Oaxaca decomposition method based on national longitudinal survey data from the China Family Panel Studies (2010–2018). The results indicate that the union wage premium among rural migrant workers is greater than that among local urban workers. The disparity in union density widens the wage gap, whereas the difference in union wage premiums narrows the wage gap between the two groups. Moreover, the contribution rate of the former is greater than that of the latter. These results suggest that expanding union coverage among rural migrant workers could effectively contribute to reducing the wage gap.</p></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 3","pages":"Pages 133-150"},"PeriodicalIF":1.9,"publicationDate":"2024-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S2666933124000418/pdfft?md5=8a097e40d580a7c7db85d94018391c06&pid=1-s2.0-S2666933124000418-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142229957","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-09-01DOI: 10.1016/j.ceqi.2024.09.001
Indra de Soysa , Krishna Chaitanya Vadlamannati
Employing newly available data on Chinese Covid-19 vaccine deliveries for a cross-section of 157 countries, we examine if China's vaccine diplomacy is driven by altruistic, enlightened self-interested motives or by purely strategic motives. According to the enlightened self-interested logic, China's vaccine supply would coincide with helping countries dependent on China for trade, i.e. its trading friends, while the strategic logic would entail providing vaccines to countries important commercially to China. In other words, the gravity of the Covid situation would be leveraged by China for strategic gain. Utilizing the logit estimator on probability of receiving vaccines from China and Tobit estimator on vaccine purchases and donations, we find that developing countries that are important to China's trade, and thereby, China's own commercial interests were less likely to get vaccines compared with countries that are more dependent on China. Furthermore, we find that countries more dependent on China are also likely to receive vaccine donations rather than purchases, suggesting that vaccine diplomacy was unlikely to be for commercial and strategic gain. Our results taken together signify that vaccine deliveries by China were not manipulated by trade interests in Beijing. The results suggest instead that China supplied vaccines to countries needing them and with whom Chinese goodwill reflects a more normal course of diplomacy—to service friends in need.
{"title":"A friend indeed to friends in need? China's trade regime and Covid-19 vaccine diplomacy","authors":"Indra de Soysa , Krishna Chaitanya Vadlamannati","doi":"10.1016/j.ceqi.2024.09.001","DOIUrl":"10.1016/j.ceqi.2024.09.001","url":null,"abstract":"<div><div>Employing newly available data on Chinese Covid-19 vaccine deliveries for a cross-section of 157 countries, we examine if China's vaccine diplomacy is driven by altruistic, enlightened self-interested motives or by purely strategic motives. According to the enlightened self-interested logic, China's vaccine supply would coincide with helping countries dependent on China for trade, i.e. its trading friends, while the strategic logic would entail providing vaccines to countries important commercially to China. In other words, the gravity of the Covid situation would be leveraged by China for strategic gain. Utilizing the logit estimator on probability of receiving vaccines from China and Tobit estimator on vaccine purchases and donations, we find that developing countries that are important to China's trade, and thereby, China's own commercial interests were less likely to get vaccines compared with countries that are more dependent on China. Furthermore, we find that countries more dependent on China are also likely to receive vaccine donations rather than purchases, suggesting that vaccine diplomacy was unlikely to be for commercial and strategic gain. Our results taken together signify that vaccine deliveries by China were not manipulated by trade interests in Beijing. The results suggest instead that China supplied vaccines to countries needing them and with whom Chinese goodwill reflects a more normal course of diplomacy—to service friends in need.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 3","pages":"Pages 212-226"},"PeriodicalIF":1.9,"publicationDate":"2024-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142531085","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-09-01DOI: 10.1016/j.ceqi.2024.09.002
Dong Chen , Shi Chen
This study examines the impact of judicial protection of intellectual property rights on firms' independent innovation. Using a staggered difference-in-differences model with panel data from Chinese manufacturing listed businesses (2014–2021) and the successive establishment of intellectual property courts in Chinese prefectural-level cities as a quasi-natural experiment, we find that establishing intellectual property courts in China encourages businesses to accumulate more technology-based intangible assets. Mechanism analysis suggests that judicial intellectual property protection enhances enterprises' independent innovation capacity by establishing a conducive institutional framework. This stimulating effect is particularly significant for industry-leading companies with technological supremacy. Heterogeneity analysis reveals that judicial intellectual property protection increases the generation of patents and trade secrets, with a more pronounced effect on firms receiving higher government research and development subsidies and better tax incentives. This study offers valuable insights for policymakers to encourage corporate independent innovation.
{"title":"Promoting corporate independent innovation through judicial protection of intellectual property rights","authors":"Dong Chen , Shi Chen","doi":"10.1016/j.ceqi.2024.09.002","DOIUrl":"10.1016/j.ceqi.2024.09.002","url":null,"abstract":"<div><div>This study examines the impact of judicial protection of intellectual property rights on firms' independent innovation. Using a staggered difference-in-differences model with panel data from Chinese manufacturing listed businesses (2014–2021) and the successive establishment of intellectual property courts in Chinese prefectural-level cities as a quasi-natural experiment, we find that establishing intellectual property courts in China encourages businesses to accumulate more technology-based intangible assets. Mechanism analysis suggests that judicial intellectual property protection enhances enterprises' independent innovation capacity by establishing a conducive institutional framework. This stimulating effect is particularly significant for industry-leading companies with technological supremacy. Heterogeneity analysis reveals that judicial intellectual property protection increases the generation of patents and trade secrets, with a more pronounced effect on firms receiving higher government research and development subsidies and better tax incentives. This study offers valuable insights for policymakers to encourage corporate independent innovation.</div></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 3","pages":"Pages 167-181"},"PeriodicalIF":1.9,"publicationDate":"2024-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142415995","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-06-01DOI: 10.1016/j.ceqi.2024.06.001
Yu Luo , Ming-ang Zhang , Gaoyi Lin
This paper draws on a natural experiment generated by the Key Tax Source (KTS) supervision in China to evaluate the impact of strengthening tax administration on firm's emission behavior. Using a Fuzzy Regression Discontinuity Design, we find that KTS supervision by State Administration of Taxation significantly improves firm's SO2 emissions. The mechanism analysis shows that, KTS firms tend to reduce their tax burden by over-emitting pollution; Meanwhile, local governments loosen environmental regulation on the KTS firms, which eventually causes KTS firms to adjust the energy utilization structure and reduce environmental protection investment. Further analysis shows that the pollution emission by KTS firms can be reduced by the implemented of tax credits and the improved environmental regulation standards.
{"title":"Unexpected environmental pollution: The cross-sector spillover effect of tax administration","authors":"Yu Luo , Ming-ang Zhang , Gaoyi Lin","doi":"10.1016/j.ceqi.2024.06.001","DOIUrl":"https://doi.org/10.1016/j.ceqi.2024.06.001","url":null,"abstract":"<div><p>This paper draws on a natural experiment generated by the Key Tax Source (KTS) supervision in China to evaluate the impact of strengthening tax administration on firm's emission behavior. Using a Fuzzy Regression Discontinuity Design, we find that KTS supervision by State Administration of Taxation significantly improves firm's SO2 emissions. The mechanism analysis shows that, KTS firms tend to reduce their tax burden by over-emitting pollution; Meanwhile, local governments loosen environmental regulation on the KTS firms, which eventually causes KTS firms to adjust the energy utilization structure and reduce environmental protection investment. Further analysis shows that the pollution emission by KTS firms can be reduced by the implemented of tax credits and the improved environmental regulation standards.</p></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 2","pages":"Pages 94-106"},"PeriodicalIF":0.0,"publicationDate":"2024-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S2666933124000285/pdfft?md5=8b0f6c420ac9e3f360ab35048415d4ca&pid=1-s2.0-S2666933124000285-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141313888","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-06-01DOI: 10.1016/j.ceqi.2024.06.003
Zhibin Ji , Naide Ye , Dongmin Kong
Employing the exogenous scenario of the “New Rules on Asset Management” in April 2018, this paper tries to explore the impact of the contraction of Chinese shadow banking on corporate investment behavior. This paper finds that the regulation leads to a 18.3% decrease in capital expenditure for firms relying on shadow banking system prior to the shock. Then, this paper tests three underlying mechanisms, which include the decrease of corporate borrowing, the increase of corporate financing constraints and the reduction of debt maturity. This paper also provides the empirical evidence that the implementation of the “New Rules on Asset Management” optimizes the allocation of capital across firms.
{"title":"The contraction of Chinese shadow banking and corporate investment behavior: Evidence from the background of the “New Rules on asset management”","authors":"Zhibin Ji , Naide Ye , Dongmin Kong","doi":"10.1016/j.ceqi.2024.06.003","DOIUrl":"https://doi.org/10.1016/j.ceqi.2024.06.003","url":null,"abstract":"<div><p>Employing the exogenous scenario of the “New Rules on Asset Management” in April 2018, this paper tries to explore the impact of the contraction of Chinese shadow banking on corporate investment behavior. This paper finds that the regulation leads to a 18.3% decrease in capital expenditure for firms relying on shadow banking system prior to the shock. Then, this paper tests three underlying mechanisms, which include the decrease of corporate borrowing, the increase of corporate financing constraints and the reduction of debt maturity. This paper also provides the empirical evidence that the implementation of the “New Rules on Asset Management” optimizes the allocation of capital across firms.</p></div>","PeriodicalId":100238,"journal":{"name":"China Economic Quarterly International","volume":"4 2","pages":"Pages 119-132"},"PeriodicalIF":1.9,"publicationDate":"2024-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S2666933124000303/pdfft?md5=ad379a2c0abd96a365fe48fd28d78a3b&pid=1-s2.0-S2666933124000303-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141434774","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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