Impact of high-speed rail opening on the efficiency of enterprise human capital investment: Evidence from China

Xuanze Cao

Article ID: 2453
Vol 8, Issue 2, 2024

VIEWS - 2564 (Abstract)

Abstract


In the current context of China’s vigorous development of its high-speed rail (HSR) network to accelerate the realization of connectivity, which is the aim of the “Belt and Road” initiative, it is crucial to study how the specific opening of HSR enhances enterprise human capital investment efficiency. Using a multiple-time-point difference-in-differences (DID) regression model, we empirically study data from listed Chinese companies. An HSR opening can promote the efficiency of an enterprise’s human capital investment. We further explore the relationship between HSR and a company’s human capital investment, by considering the moderating effects of firm property rights and foreign shareholding. Our findings indicate that these factors can enhance the impact of HSR on the efficiency of firms’ investments in human capital. Finally, to ensure the reliability of our experimental findings, we employed a combination of propensity score matching and the DID methodology. The findings of this study offer empirical evidence that can inform enterprise management strategies and provide valuable insights for policymakers seeking to promote economic growth.


Keywords


high-speed rail opening; human capital investment efficiency; firm property rights; foreign shareholding

Full Text:

PDF


References


Alon I, Wang H, Shen J, et al. (2014). Chinese state-owned enterprises go global. Journal of Business Strategy, 35(6), 3–18. https://doi.org/10.1108/jbs-12-2013-0118 Ben-Nasr H, Alshwer AA (2016). Does stock price informativeness affect labor investment efficiency? Journal of Corporate Finance, 38, 249–271. https://doi.org/10.1016/j.jcorpfin.2016.01.012 Bertrand M (2003). Public Policy and Extended Families: Evidence from Pensions in South Africa. The World Bank Economic Review, 17(1), 27–50. https://doi.org/10.1093/wber/lhg014 Bosker M, Brakman S, Garretsen H, et al. (2012). Relaxing Hukou: Increased labor mobility and China’s economic geography. Journal of Urban Economics, 72(2–3), 252–266. https://doi.org/10.1016/j.jue.2012.06.002 Cao Y, Dong Y, Lu Y, et al. (2018). Does Institutional Ownership Improve Firm Investment Efficiency? Emerging Markets Finance and Trade, 56(12), 2772–2792. https://doi.org/10.1080/1540496x.2018.1486705 Cao Z, Rees W (2020). Do employee-friendly firms invest more efficiently? Evidence from labor investment efficiency. Journal of Corporate Finance, 65, 101744. https://doi.org/10.1016/j.jcorpfin.2020.101744 Chen Z, Haynes KE. (2017). Impact of high-speed rail on regional economic disparity in China. Journal of Transport Geography, 65, 80–91. https://dx.doi.org/10.1016/j.jtrangeo.2017.08.003 Chu J, Fang J (2020). Economic policy uncertainty and firms’ labor investment decision. China Finance Review International, 11(1), 73–91. https://doi.org/10.1108/cfri-02-2020-0013 Dollar D, Wei SJ (2007). Das (Wasted) Kapital: Firm Ownership and Investment Efficiency in China. National Bureau of Economic Research. https://doi.org/10.3386/w13103 Du XQ, Peng MW (2017). Do high-speed trains motivate the flow of corporate highly educated talents. Business Management Journal, 39(12), 89–107. Duffhues P, Kabir R, Mertens G, et al. (2002). Employee Stock Option Grants and Firm Performance in the Netherlands. Corporate Governance Regimes, 668–678. https://doi.org/10.1093/oso/9780199247875.003.0028 Fan H (2020). Impacts of High-Speed Rail Stations Opening on the Regional Innovation Level—Analysis Based on Scoring Tendency Matching Model. Modern Economy, 11(02), 383–398. https://doi.org/10.4236/me.2020.112029 Ghaly M, Dang VA, Stathopoulos K (2020). Institutional investors’ horizons and corporate employment decisions. Journal of Corporate Finance, 64, 101634. https://doi.org/10.1016/j.jcorpfin.2020.101634 Guo H, Wu K (2020). Does opening high-speed railways affect the cost of debt financing? A quasi-natural experiment. China Finance Review International, 10(4), 473–496. https://doi.org/10.1108/cfri-06-2019-0083 Jung B, Lee W, Weber DP (2014). Financial Reporting Quality and Labor Investment Efficiency. Contemporary Accounting Research, 31(4), 1047–1076. Portico. https://doi.org/10.1111/1911-3846.12053 Khedmati M, Sualihu MA, Yawson A (2020). CEO-director ties and labor investment efficiency. Journal of Corporate Finance, 65, 101492. https://doi.org/10.1016/j.jcorpfin.2019.101492 Lee KYK, Mo K. (2020). Do analysts improve labor investment efficiency? Journal of Contemporary Accounting & Economics, 16(3), 100213. https://doi.org/10.1016/j.jcae.2020.100213 Li F, Su Y, Xie J, et al. (2020). The Impact of High-Speed Rail Opening on City Economics along the Silk Road Economic Belt. Sustainability, 12(8), 3176. https://doi.org/10.3390/su12083176 Li Y, Chen Z, Wang P (2020). Impact of high-speed rail on urban economic efficiency in China. Transport Policy, 97, 220–231. https://doi.org/10.1016/j.tranpol.2020.08.001 Marginson S (2017). Limitations of human capital theory. Studies in Higher Education, 44(2), 287–301. https://doi.org/10.1080/03075079.2017.1359823 Mourao PR (2018). What is China seeking from Africa? An analysis of the economic and political determinants of Chinese Outward Foreign Direct Investment based on Stochastic Frontier Models. China Economic Review, 48, 258–268. https://doi.org/10.1016/j.chieco.2017.04.006 Oh H, Park S (2022). Does Corporate Governance Affect Labor Investment Efficiency? Sustainability, 14(8), 4599. https://doi.org/10.3390/su14084599 Pinnuck M, Lillis AM (2007). Profits versus Losses: Does Reporting an Accounting Loss Act as a Heuristic Trigger to Exercise the Abandonment Option and Divest Employees? The Accounting Review, 82(4), 1031–1053. https://doi.org/10.2308/accr.2007.82.4.1031 Shi W, Lin KC, McLaughlin H, et al. (2020). Spatial distribution of job opportunities in China: Evidence from the opening of the high-speed rail. Transportation Research Part A: Policy and Practice, 133, 138–147. https://doi.org/10.1016/j.tra.2020.01.006 Song L, Yang J, Zhang Y (2011). State-owned Enterprises’ Outward Investment and the Structural Reform in China. China & World Economy, 19(4), 38–53. Portico. https://doi.org/10.1111/j.1749-124x.2011.01249.x Tran QT (2020). Foreign ownership and investment efficiency: new evidence from an emerging market. International Journal of Emerging Markets, 15(6), 1185–1199. https://doi.org/10.1108/ijoem-07-2019-0573 Wang C, Wu J, Liu X (2022). High-speed rail and urban innovation: based on the perspective of labor mobility. Journal of the Asia Pacific Economy, 1–26. https://doi.org/10.1080/13547860.2022.2058257 Wang H, Wang W, Alhaleh SEA (2021). Mixed ownership and financial investment: Evidence from Chinese state-owned enterprises. Economic Analysis and Policy, 70, 159–171. https://doi.org/10.1016/j.eap.2021.02.006 Wei C, Hu S, Chen F (2020). Do political connection disruptions increase labor costs in a government-dominated market? Evidence from publicly listed companies in China. Journal of Corporate Finance, 62, 101554. https://doi.org/10.1016/j.jcorpfin.2019.101554 Wu Y, Lee CC, Lee CC, et al. (2022). Geographic proximity and corporate investment efficiency: Evidence from high-speed rail construction in China. Journal of Banking & Finance, 140, 106510. https://doi.org/10.1016/j.jbankfin.2022.106510 Xie J (2015). CEO career concerns and investment efficiency: Evidence from China. Emerging Markets Review, 24, 149–159. https://doi.org/10.1016/j.ememar.2015.06.001 Xu F, Liu Q, Zheng X, et al. (2022). Research on the impact of China’s high-speed rail opening on enterprise market power: Based on the perspective of market segmentation. Transport Policy, 128, 121–137. https://doi.org/10.1016/j.tranpol.2022.09.0197.



DOI: https://doi.org/10.24294/jipd.v8i2.2453

Refbacks

  • There are currently no refbacks.


Copyright (c) 2024 Xuanze Cao

License URL: https://creativecommons.org/licenses/by/4.0/

This site is licensed under a Creative Commons Attribution 4.0 International License.