Investing with the Government
A Field Experiment in China
Bibliographic Data
| ID | 10173026 |
|---|---|
| Authors | Emanuele Colonnelli (Economic Research Centre), Bo Li (0000-0002-7801-0319), Li Bo (0000-0001-9481-8804, Peking University), Ernest Liu (National Bureau of Economic Research) |
| Year | 2023 |
| Volume | 132 |
| Issue | 1 |
| Pages | 248-294 |
| Publication date | 2023-06-14 |
| Peer Reviewed | Yes |
| Open Access | No |
| Type | ARTICLE |
| Venue | Journal of Political Economy (JOURNAL) |
| Journal identifiers | ISSN: 0022-3808 • E-ISSN: 1537-534X |
| Publisher | University of Chicago Press (PUBLISHER • US) |
| DOI | 10.1086/726237 |
| OpenAlex | W4380563761 |
| Language | EN |
| Citations received | 7 |
| References cited | 49 |
We conduct a large-scale, nondeceptive field experiment to elicit preferences for government participation in China's venture capital and private equity market. Our main result is that the average firm dislikes investors with government ties. We show that such dislike is not present with government-owned firms and that this dislike is highest with best-performing firms. Additional results and surveys suggest that political interference in decision-making is the leading reason why government investors are unattractive to private firms. Overall, our findings point to the limits of a model of “state capitalism” that strongly relies on the complementarity between private firms and government capital to drive high-growth entrepreneurship and innovation
Business · China · Complementarity (molecular biology · Economics · Entrepreneurship · Equity (law · Government (linguistics · Market economy · Political science · Politics · Private equity · Venture capital · Corruption and Economic Development · Economic Policies and Impacts · Finance · Local Government Finance and Decentralization
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Industrial policy in a new era
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Field Experiments
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Politicians and banks
Finance and Growth
Estimation and Inference of Heterogeneous Treatment Effects using Random Forests
Bank-Based or Market-Based Financial Systems
The theory and practice of corporate finance
The Razor's Edge
Estimating Treatment Effects with Causal Forests
Financial markets and the allocation of capital
Do Lenders Favor Politically Connected Firms? Rent Provision in an Emerging Financial Market
Corruption
Doing business in China
The Small World of Investing
Boulevard of broken dreams
The Investment Strategies of Sovereign Wealth Funds
State versus Private Ownership
| Unique citing works | 7 |
|---|---|
| Citations per year | 7 |
| Citation span | 2025 - 2026 (2) |
| Citation velocity | current |
| Highly cited | No |
| Citation types | Neutral: 7 |