Credit Expansion, Corporate Finance and Overinvestment: Recent Evidence from China

Volume: 39, Pages: 16 - 27
Published: Sep 1, 2016
Abstract
This paper examines the impacts of a recent credit expansion event on corporate policies in China. During the credit boom in 2009 and 2010, the large and state-owned firms increased leverage ratios by 2.89% and 1.68% (on a quarterly basis) more than their matched firms. State-owned firms had higher increases in loan financing and corporate investment than their matched firms due to government intervention and better access to the credit market....
Paper Details
Title
Credit Expansion, Corporate Finance and Overinvestment: Recent Evidence from China
Published Date
Sep 1, 2016
Volume
39
Pages
16 - 27
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