Time: 13:00-15:00 (UK Time), Wednesday, 13 March 2024
Presenters: Dr. Huanjia Ma and Prof. Alessandra Guariglia, University of Birmingham
Chair: Prof. Victor Murinde, SOAS University of London
Online venue:Click here to join the seminar on Teams(For any inquiry about how to join the online seminar, please contact Dr. Meng Xie at xm1@soas.ac.uk)
Abstract
This paper is the first to investigate how Chinese firms’ corrupt practices react to the loss of political connections resulting from the Anti-Corruption Campaign (ACC). To this end, we create a novel and unique panel of 2,711 listed firms over the period 2010-2017, which links firms with specific high-level officials to which they are connected either personally or through meetings. We proxy corruption activity using entertainment and travel costs (ETC). We find that firms’ ETC increase significantly after the loss of both personal and meeting connections resulting from the arrest of officials, likely to enable firms to forge new connections. This effect is driven by non-state-owned enterprises, firms headquartered in provinces characterised by low banking competition, and firms that rely on government subsidies. Our results suggest that, especially for these firms, the costs inflicted by the campaign are still outweighed by the benefits of political connections. We conclude that the ACC may not have been as effective in reducing corruption as the government had hoped.
Presenters
Prof. Alessandra Guariglia is Professor of Financial Economics at the University of Birmingham. Her research interests range from corporate finance and the economics of transition in China, to health economics. Her research has been published in journals such as the Journal of Corporate Finance, the Review of Finance, the British Journal of Management, the Journal of Banking and Finance, the Journal of International Economics, Social Science and Medicine, and the Journal of Development Economics. She is co-editor in chief of the Journal of Climate Finance, co-editor of the Scottish Journal of Political Economy and the Journal of Chinese Economic and Business Studies, and associate editor of the European Journal of Finance and the British Accounting Review. She has been Head of the Department of Economics at Birmingham from 2012 to 2015, and Head of the Departments of Economics and Accounting & Finance at the University of Durham between 2009 and 2012. Prior to that, she has worked at the Universities of Nottingham, Kent, and Essex.
Dr. Huanjia Ma is a research fellow at City-REDI in the Birmingham Business School. He joined the City-REDI team in February 2022 as a Research Fellow after completing his PhD in Economics at the University of Birmingham. As an applied economist, Huanjia specialises in secondary data analysis, including panel regression and causal inference, with a focus on both firm-level and regional analysis. His research includes examining how labour market conditions influence firm productivity and innovation, as well as the impact of the political-economic environment on Chinese firms. Huanjia's research also extends to input-output modelling, involving regional forecasting and crafting detailed regional accounts across multiple dimensions.