Is There Cronyism?Evidence from Land Market and Corporate Political Cycles in China

主讲人: Qinghua Zhang

Associate Professor at Guanghua School of Management, Peking University.

Prof. Zhang's CV

主持人: Pei Lin

This paper measures the degree of industrial land subsidy to companies using the ratio of the market value of land in the neighborhood over the price at which the company purchased the land from the local government. Matching data of publicly listed companies with land transaction data from 1998 to 2013 in China, we find that heavily subsidized companies exhibit starker political business cycles, in terms of higher investment rate in the preceding year of the expected turnover of local leaders. However, these companies’ investment efficiency decline in the political key year. We interpret these findings as evidence of cronyism; that is, listed companies return the favor of land subsidy from local leaders since increased investment before turnovers can boost local GDP and enhance the leaders’ promotion likelihood. 

时间: 2018-10-17(Wednesday)16:40-18:00
地点: N302, Econ Building
主办单位: WISE&SOE
类型: 系列讲座