Is the Chinese Anti-Corruption Campaign Authentic? Evidence from Corporate Investigations
108 Pages Posted: 20 May 2016 Last revised: 23 Apr 2021
Date Written: April 22, 2021
This paper examines whether the massive Chinese anti-corruption campaign ensnares corrupt firms, contains a political component, and reduces corporate corruption. Consistent with the campaign’s stated objectives, Chinese firms with characteristics commonly associated with measures of poor governance, self-dealing, and inefficiencies are more likely to have executives investigated. However, affiliations with prominent investigated political leaders increase investigation likelihood while university affiliations with current central leadership decrease investigation likelihood, possibly indicating political favoritism. Except for reported entertainment expenditures and CEO pay, there has been little evidence of a substantial overall decrease in measures of potential corporate corruption.
Keywords: Anti-Corruption Campaign, China, Corrupt Managers, Corrutpion Measures, Corporate Culture
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