Market access and firm productivity: Evidence from a natural experiment

Mengting Jiang, Pu Gong and Dongmin Kong

Finance Research Letters, 2024, vol. 70, issue C

Abstract: Based on China's Market Access Prohibition List, this paper explores the impact of market access reforms on firm productivity, employing data from Chinese listed companies from 2010 to 2019. To identify causality, we conduct a staggered DID estimation and find that provinces implementing the Market Access Prohibition List exhibit higher growth in productivity than those that do not. Moreover, this positive effect is more pronounced for non-SOEs and firms in less marketed regions. Reducing rent-seeking costs and promoting corporate innovation serve as mechanisms to facilitate firm productivity. This research sheds light on the economic consequences of liberalizing market access restrictions.

Keywords: Market access; Total factor productivity; Corporate innovation (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:70:y:2024:i:c:s1544612324012960

DOI: 10.1016/j.frl.2024.106267

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