The effects of government ownership and the global financial crisis on implicit taxes of Chinese companies
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Author(s)SungMan YoonLink to ORCID Index: https://orcid.org/0000-0003-2093-1059
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Di QuLink to ORCID Index: https://orcid.org/0000-0001-5966-0298
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DOIhttp://dx.doi.org/10.21511/imfi.18(2).2021.25
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Article InfoVolume 18 2021, Issue #2, pp. 312-321
- 522 Views
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233 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
The government has implemented various tax incentive policies to support the generation and growth of corporate profits, leading to what is known as an implicit tax. In actuality, there is no implicit tax phenomenon because this phenomenon occurs in a perfectly competitive market where there are no barriers to entry, transaction costs, or transaction friction. Since most Chinese companies are owned by the Chinese government and are not fully capitalist markets, the possibility of more implicit taxes is not expected to occur. Therefore, the purpose of this study is to investigate whether the Chinese government’s ownership of enterprises and the global financial crisis have had an effect on the realization of the implicit tax phenomena. The results of this study are as follows. First, the pre-tax return on equity (PTROE) of listed Chinese companies had a statistically significant positive relationship with the pre-tax subsidy on equity (PTSE). Second, for companies with a higher level of Chinese government-owned interest, PTROE had a statistically significant positive relationship with PTSE; so this result shows that Chinese companies receive tax benefits, but an implicit tax in the market is not realized. Third, during the global financial crisis, the PTROE of Chinese companies showed an insignificant negative relationship with PTSE. In addition, companies owned by the Chinese government showed an insignificant negative relationship between PTROE and PTSE during the global financial crisis. This study provides policy implications that government ownership equity and macroeconomic events influence the level of freedom in a market economy.
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JEL Classification (Paper profile tab)G18, H27, M41
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References18
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Tables6
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Figures0
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- Table 1. Distribution of samples
- Table 2. Descriptive statistics
- Table 3. Correlation analysis
- Table 4. Regression results: effects of governmental ownership on the realization of an implicit tax
- Table 5. Regression results: effects of the global financial crisis on the realization of an implicit tax
- Table 6. Regression results: effects of governmental ownership and the global financial crisis on the realization of an implicit tax
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Stock market, real estate market, and economic growth: an ARDL approach
My-Linh Thi Nguyen ,
Toan Ngoc Bui
doi: http://dx.doi.org/10.21511/imfi.16(4).2019.25
Investment Management and Financial Innovations Volume 16, 2019 Issue #4 pp. 290-302 Views: 1310 Downloads: 249 TO CITE АНОТАЦІЯThe paper investigates the correlation between stock market, real estate market, and economic growth in Vietnam, which is an emerging country. Quarterly data in Vietnam from the third quarter of 2004 to the third quarter of 2018 were utilized. By using the Autoregressive Distributed Lag (ARDL) approach, the results reveal that economic growth is positively associated with stock market and real estate market. An unprecedented finding of this study is that economic growth (GDP) is more correlated to stock market efficiency (SME) than net trading value by foreign investors (FI). Moreover, global financial crisis (GFC) exerts a negative impact on economic growth and real estate market in Vietnam. Further, net trading value by foreign investors (FI) also negatively influences real estate market (REM) in the short term. The study has greatly succeeded in giving first empirical evidence on the relationship between stock market, real estate market, and economic growth in Vietnam. More than that, the results show the key role of global financial crisis in this correlation. The findings are valuable to economies around the world, especially bringing a practical and meaningful value to developing countries like Vietnam.
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The use and trend of emotional language in the banks’ annual reports: the state of the global financial crisis
Elsayed A. H. Elamir ,
Gehan A. Mousa
doi: http://dx.doi.org/10.21511/bbs.14(2).2019.02
Banks and Bank Systems Volume 14, 2019 Issue #2 pp. 9-23 Views: 1287 Downloads: 156 TO CITE АНОТАЦІЯThis study is of an exploratory nature as it seeks to explore the extent to which the language of emotions in the banks’ annual reports is affected by the global financial crisis (GFC). The language of emotions was analyzed using eight categories (trust, anticipation, sadness, anger, fear, disgust, surprise and joy) in annual reports of 12 listed banks from six countries in the Middle East area (namely, Jordan, Kingdom of Bahrain, United Arab Emirates, Sultanate of Oman, Kuwait, Kingdom of Saudi Arabia) from 2002 to 2017. The final data set consists of 192 bank-year observations. The study time was divided into three periods (pre, during and post GFC). In addition, the study enriches accounting literature by being the first study to test Pollyanna hypothesis using emotion analysis. The results of the study show that the percentage of emotional words in banks’ annual reports (2002–2017) represents almost 22% on average. The trust, anticipation and fear categories were the most affected than other emotional categories during GFC. While the trust category decreased, both the fear and anticipation categories increased. Other findings of the study show that regardless of GFC, emotional words of trust and anticipation categories in banks’ annual reports have dominated the emotional words of the disgust and surprise categories. Therefore, Pollyanna hypothesis is supported. In contrast to the emotional words of the joy category in banks’ annual reports which has not dominated the sadness category. In this case, Pollyanna hypothesis is rejected.
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Do foreign and state banks take more risk?
Fitri Ismiyanti ,
Afwadi Rahman ,
Putu Anom Mahadwartha
doi: http://dx.doi.org/10.21511/bbs.13(4).2018.09
Banks and Bank Systems Volume 13, 2018 Issue #4 pp. 96-102 Views: 1136 Downloads: 172 TO CITE АНОТАЦІЯThis paper addresses the impact of foreign ownership, government ownership, efficiency and income diversification on the risk-taking behavior of banks in Indonesia. This research uses Z-Score to measure bank risk-taking behavior. Z-score proxies probability bank’s loss that is greater than its equity. Despite their profit, bank may suffer financial insolvency when taking too much risk. This study used a sample of 44 banks in Indonesia over the 2011–2016 period with purposive sampling method. Based on the result of the research, it can be concluded that foreign ownership can increase bank risk-taking behavior due to the barrier to entry in the form of deficiency of quality information of the borrower so that it has an impact on the increase of non-performing loan ratio. While government ownership can also increase risk-taking behavior, because banks are used by politicians to pursue political goals that cause banks to take high-risk projects with low profits. In addition, the results of this study also show that banks with low efficiency tend to increase the risk-taking behavior.
