Study on the Impact of Industry Prosperity on the Level of Corporate Risk Taking
Journal: International Journal of Trend in Scientific Research and Development (Vol.7, No. 6)Publication Date: 2023-12-16
Authors : Zhang Beiheng;
Page : 442-447
Keywords : Regional differences; Industry prosperity; Corporate risk-taking; Eastern; central; and western regions;
Abstract
Based on the principal agent theory, we construct a research framework of external environment—investment efficiency—corporate risk taking level. Utilizing data on industry prosperity from 2019 to 2023 and combining panel data on corporate risk taking levels in the eastern, central, and western regions of China, we employ a multi time point DID model for OLS regression to analyze the impact of industry prosperity on the level of corporate risk taking under regional differences. The results indicate 1 Companies in industries with higher prosperity tend to have higher investment efficiency and more stable revenue, leading to lower levels of corporate risk taking 2 Higher market freedom weakens the influence of industry prosperity on the local corporate risk taking level 3 The degree of market liberalization in the eastern, central, and western regions of China is gradually decreasing, making the impact of industry prosperity on the risk taking level of companies highest in the western region, followed by the central region, and the eastern region experiencing the smallest impact. Zhang Beiheng "Study on the Impact of Industry Prosperity on the Level of Corporate Risk Taking" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-7 | Issue-6 , December 2023, URL: https://www.ijtsrd.com/papers/ijtsrd61201.pdf Paper Url: https://www.ijtsrd.com/management/accounting-and-finance/61201/study-on-the-impact-of-industry-prosperity-on-the-level-of-corporate-risk-taking/zhang-beiheng
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