Entrusted Payment by Lender and Enterprises'Short-term Loans for Long-term Investment
Taking the introduction of the Interim Measures for the Administration of Working Capital Loans in 2010 as an exogenous shock,this paper examines how the entrusted payment by lender(EPL)affects enterprises'use of short-term loans for long-term investment using data from non-financial listed companies in the Chinese A-share market.It is found that,after the implementation of the EPL,the extent of enterprises'use of short-term loans for long-term investment de-creased significantly.The mechanism analysis shows that the EPL inhibites the enterprises'use of short-term loans for long-term investment by motivating the enterprises to increase long-term financing and adopt more prudent operation strategy,while the fixed assets investment channel is not significant.More transactions with related parties,richer financial backgrounds of executives,and fiercer competition among regional banks mitigate the effects of the EPL.Further analysis shows that the EPL reduces firms'insolvency risk.
EPLshort-term loans for long-term investmentloan payment regulationregulatory arbitrage
NETL
NSTL
万方数据
