Back to Search
Start Over
Capital misallocation in Chinese industrial firms.
- Source :
- Scottish Journal of Political Economy; Feb2024, Vol. 71 Issue 1, p75-100, 26p
- Publication Year :
- 2024
-
Abstract
- This paper investigates the impact of volatility in profitability shock, capital price distortion and adjustment costs on capital misallocation among Chinese industrial firms. We estimate a dynamic model pertaining firms' investment decision, incorporating institutional differences between state and private firms, so the model can reproduce salient features observed from Chinese firms. Our analysis shows: (i) capital price distortion is more severe among state firms than private ones; (ii) adjusting capital is more costly for state than private firms; (iii) volatility in profitability shock is a major source that causes capital misallocation for both types of firms. [ABSTRACT FROM AUTHOR]
Details
- Language :
- English
- ISSN :
- 00369292
- Volume :
- 71
- Issue :
- 1
- Database :
- Complementary Index
- Journal :
- Scottish Journal of Political Economy
- Publication Type :
- Academic Journal
- Accession number :
- 174779526
- Full Text :
- https://doi.org/10.1111/sjpe.12354