Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform
As a city–county consolidation with Chinese characteristics, China’s county-to-district (CtD) reform transfers a county’s autonomy to a city, thereby strengthening the administrative, decision-making, fiscal and other powers of the prefecture-level municipal government, which effectively enables the...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
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Elsevier
2023-09-01
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| Series: | China Journal of Accounting Research |
| Subjects: | |
| Online Access: | http://www.sciencedirect.com/science/article/pii/S1755309123000242 |
| _version_ | 1797736680809037824 |
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| author | Qihang Xue Huimin Wang Xiaole Ji Jian Wei |
| author_facet | Qihang Xue Huimin Wang Xiaole Ji Jian Wei |
| author_sort | Qihang Xue |
| collection | DOAJ |
| description | As a city–county consolidation with Chinese characteristics, China’s county-to-district (CtD) reform transfers a county’s autonomy to a city, thereby strengthening the administrative, decision-making, fiscal and other powers of the prefecture-level municipal government, which effectively enables the centralization of local governments. Based on this exogenous quasi-natural experiment, we use a difference-in-differences (DID) approach to empirically examine the impact of prefecture-level municipal government centralization on companies’ ESG performance. The results show that municipal government centralization can significantly promote corporate ESG performance, which represents environmental protection, social responsibility and corporate governance behavior. The mechanism analysis also shows that the CtD reform can address market segmentation, alleviate policy uncertainty and reduce rent-seeking, which further improves ESG performance. |
| first_indexed | 2024-03-12T13:16:27Z |
| format | Article |
| id | doaj.art-587c463705c0488eb87e9387d7494049 |
| institution | Directory Open Access Journal |
| issn | 1755-3091 |
| language | English |
| last_indexed | 2024-03-12T13:16:27Z |
| publishDate | 2023-09-01 |
| publisher | Elsevier |
| record_format | Article |
| series | China Journal of Accounting Research |
| spelling | doaj.art-587c463705c0488eb87e9387d74940492023-08-27T04:27:12ZengElsevierChina Journal of Accounting Research1755-30912023-09-01163100314Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reformQihang Xue0Huimin Wang1Xiaole Ji2Jian Wei3School of Economics, Shandong University, Ji’nan, Shandong 250100, PR China; Zhongtai Securities Institute for Financial Studies, Shandong University, Ji’nan, Shandong 250100, PR ChinaSchool of Economics, Shandong University, Ji’nan, Shandong 250100, PR China; Zhongtai Securities Institute for Financial Studies, Shandong University, Ji’nan, Shandong 250100, PR China; Corresponding author at: School of Economics, Shandong University, 27 Shanda Nanlu, Ji’nan, Shandong 250100, PR China.Journal of Shandong University (Philosophy and Social Sciences) Editorial Office, Ji’nan, Shandong 250100, PR ChinaZhongtai Securities Institute for Financial Studies, Shandong University, Ji’nan, Shandong 250100, PR China; Journal of Shandong University (Philosophy and Social Sciences) Editorial Office, Ji’nan, Shandong 250100, PR China; Journal of Humanities and Social Sciences, Shandong University, Ji’nan, Shandong 250100, PR ChinaAs a city–county consolidation with Chinese characteristics, China’s county-to-district (CtD) reform transfers a county’s autonomy to a city, thereby strengthening the administrative, decision-making, fiscal and other powers of the prefecture-level municipal government, which effectively enables the centralization of local governments. Based on this exogenous quasi-natural experiment, we use a difference-in-differences (DID) approach to empirically examine the impact of prefecture-level municipal government centralization on companies’ ESG performance. The results show that municipal government centralization can significantly promote corporate ESG performance, which represents environmental protection, social responsibility and corporate governance behavior. The mechanism analysis also shows that the CtD reform can address market segmentation, alleviate policy uncertainty and reduce rent-seeking, which further improves ESG performance.http://www.sciencedirect.com/science/article/pii/S1755309123000242Municipal government centralizationCounty-to-district reformESGMarket segmentationPolicy uncertaintyRent-seeking |
| spellingShingle | Qihang Xue Huimin Wang Xiaole Ji Jian Wei Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform China Journal of Accounting Research Municipal government centralization County-to-district reform ESG Market segmentation Policy uncertainty Rent-seeking |
| title | Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform |
| title_full | Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform |
| title_fullStr | Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform |
| title_full_unstemmed | Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform |
| title_short | Local government centralization and corporate ESG performance: Evidence from China’s county-to-district reform |
| title_sort | local government centralization and corporate esg performance evidence from china s county to district reform |
| topic | Municipal government centralization County-to-district reform ESG Market segmentation Policy uncertainty Rent-seeking |
| url | http://www.sciencedirect.com/science/article/pii/S1755309123000242 |
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