Remote hand: Cross-regional SASAC holdings and corporate investment efficiency: Evidence from China

Pengcheng Ma, Chenyi Li and Yiyou Jiang

Finance Research Letters, 2024, vol. 67, issue PB

Abstract: The simultaneous existence of government intervention and support for state-owned enterprises makes it difficult to study the relationship between government involvement and business efficiency. Drawing on China's emerging and widely developed cross-regional state-owned holding patterns, this study examines the impact of reduced political intervention on the investment efficiency of local state-owned enterprises (SOEs) when resource support is constant. We demonstrate that the geographic separation of SASAC and SOEs contributes to corporate investment efficiency and that this effect works mainly through the reduction of political pressure and the optimisation of corporate governance. This confirms the existence of the government's grabbing effect on businesses from an opposite perspective.

Keywords: Cross-regional SASAC holdings; Political intervention; Grabbing hand; Investment efficiency (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:67:y:2024:i:pb:s1544612324009899

DOI: 10.1016/j.frl.2024.105959

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