Status Incentives and Corporate Giving: Evidence From China's Political Reform On Private Enterprises

Zhao Chen and Jipeng Zhang

Pacific Economic Review, 2017, vol. 22, issue 5, 841-860

Abstract: In this paper, we estimate the effect of status incentives on charitable giving by exploiting a natural experiment during China's political reform in 2002 that significantly improved the status of private entrepreneurs and their enterprises. We find that exogenous changes in social, political and economic status of private entrepreneurs led to a significant increase in the corporate giving of their privately owned firms. The findings are robust when we use different samples of the data and when we control for a large set of entrepreneurs and firm characteristics in the regression analysis.

Date: 2017
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