How does a fair competitive environment facilitate the growth of private enterprises: A quasi-natural experiment based on the antimonopoly law

Zhe Liu and Chuanhui Wang

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

Abstract: This study examines the impact of the Chinese antimonopoly law on the growth of private enterprises, addressing the broader economic context where fair competition is essential for fostering private sector expansion. Employing a difference-in-differences (DID) methodology and analyzing data from 2006 to 2019, this study reveals that the enforcement of the law has enhanced the growth of private firms primarily by reducing financial constraints and increasing the financing costs for highly monopolistic corporations. The results suggest that stringent enforcement of the antimonopoly law will significantly alleviate financial difficulties and stimulate the growth of private firms, thereby achieving high-quality economic development.

Keywords: Competition policy; Antimonopoly law; Private enterprise; Financial constraint (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:67:y:2024:i:pb:s1544612324008444

DOI: 10.1016/j.frl.2024.105814

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