Article ID Journal Published Year Pages File Type
7352181 Finance Research Letters 2018 19 Pages PDF
Abstract
The purpose of this paper is to study the interaction among corporate investment efficiency, credit supply distortion and managerial forecast ability in China. We provide robust evidence that credit distortion adversely affects corporate investment efficiency, while better managerial forecast ability mitigates this negative effect. Subsample analyses show that managerial forecast ability mitigates the adverse effect of credit supply distortion for non-state-owned enterprises but not for state-owned enterprises. We also find evidence that negative credit supply distortions have a greater impact on corporate investment efficiency and managerial forecast ability is particularly important in reducing underinvestment.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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