From past lies to current misconduct: The long shadow of China's Great Leap Forward

Shuo Chen, Haoyuan Ding, Shu Lin and Haichun Ye

Journal of Development Economics, 2022, vol. 157, issue C

Abstract: Using hand-collected data on yield over-reporting during China's Great Leap Forward (GLF) period, we find that GLF over-reporting in a chairperson's province of origin strongly predicts corporate financial misconduct today. Evidence from a variety of identification strategies establishes a causal relationship. We also extend our analyses to other aspects of corporate misconduct and local dishonest behaviors. We show that GLF over-reporting has shifted social norms toward a present-day tolerance for dishonesty. Our findings suggest that wrongdoings by local government officials in the past can lead to adverse effects on people's future behavior in the form of cheating.

Keywords: Dishonest behavior; Social norms; Corporate financial misconduct; Yield over-reporting; Great leap forward (search for similar items in EconPapers)
JEL-codes: D91 G30 N25 P37 Z13 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:157:y:2022:i:c:s0304387822000530

DOI: 10.1016/j.jdeveco.2022.102888

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