Governmental pressures and firms’ export product quality: Evidence from China

Jianjun Wu, Xiuying Ding and Xuemei Liu

Finance Research Letters, 2023, vol. 55, issue PA

Abstract: This study explores the effects of government's fiscal stress on firms’ export product quality. Using a tax shock in China as an exogenous experiment, we find positive effect of local governments’ fiscal stress on firms’ export product quality. Dynamic analysis shows that our findings are robust. Moreover, we find that the effects of local governments’ fiscal stress on export product quality elevation are more prominent in firms with a lower degree of resource misallocation, higher industry competition exposure, and more well-educated staff. Our study may inspire regulators who are concerned with fiscal policy and firms aiming to improve export competitiveness.

Keywords: Local governments’ fiscal stress; Export product quality; China (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:55:y:2023:i:pa:s1544612323002222

DOI: 10.1016/j.frl.2023.103850

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