Impact of Local Official Corruption on Local Government Debt in China: The Mediating Role of Government Investment Efficiency

Li, Yang; Hu, Wang; Zhen-xing, SU

doi:10.1177/21582440231184976

Cited by 3 publications

(2 citation statements)

References 78 publications

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“…Although there is conflicting evidence of Chinese intentional manipulation of debts to acquire the strategic port, the Sri Lanka case could serve as a cautious example of mega project and loans management for Vietnamese infrastructure ODF. Besides, studies in Africa and South Asia have agreed that Chinese loans in developing countries foster local corruption and as such often result in poor project mismanagement and debt unsustainability due to loose lending conditions (Isaksson & Kotsadam, 2018;Li, WenXiu, & ZhenXing, 2023).…”

Section: Fulbright Review Of Economics and Policymentioning

confidence: 99%

Geoeconomic and foreign policy implications of Vietnam’s economic dependency on China

Nguyen-Vo

2024

FREP

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PurposeThis research aims to offers a new method for assessing geoeconomic risks in bilateral relations and evaluate the level of such risks from Vietnam’s economic dependency on China.Design/methodology/approachI apply descriptive analysis to identify asymmetrical dependency in Vietnam–China economic relations and propose a geoeconomic risk assessment framework to evaluate risk levels in bilateral economic linkages.FindingsThe proposed geoeconomic risk framework assesses risk levels, which are positively influenced by the degree of asymmetrical relations (vulnerabilities), the net impacts on the receiving economy (impacts) and the sending state’s ability to control economic tools (threats). In contrast, risk levels are negatively affected by the effectiveness of existing mitigation efforts. The framework employs ordinal likelihood scales to rank various risk levels. In the context of Vietnam–China relations, market access for agricultural products and control of the Mekong water emerge as the most risky areas for economic coercion, followed by Chinese official development finance in infrastructure and critical input imports. On the other hand, debt dependency and foreign direct investment in the energy sector are considered more secure areas—less likely targets for economic coercion. Hence, risk mitigation strategies should prioritize reducing asymmetry in vulnerable dependence areas while maintaining current practices in more secure areas.Originality/valueMethodologically, it introduces a new approach for assessing bilateral geoeconomic risk. Empirically, it provides Vietnam’s policymakers with a comprehensive evaluation of the implications of economic interdependence with China.

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Section: Fulbright Review Of Economics and Policymentioning

confidence: 99%

Geoeconomic and foreign policy implications of Vietnam’s economic dependency on China

Nguyen-Vo

2024

FREP

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“…Furthermore, regional heterogeneity analysis demonstrates that the negative impact of corruption on debt accumulation weakens or even vanishes in developed regions compared to underdeveloped ones. This nding suggests that anti-corruption initiatives can be particularly effective in promoting sound local government debt management, especially in economically advanced regions (Li et al, 2023).…”

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confidence: 90%

Corruption and Social Capital: Findings From Selected OECD Countries

Bayraktar

2024

Preprint

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Corruption, a pervasive global challenge, erodes trust in institutions, hinders development, and deepens inequalities. While numerous factors contribute to its persistence, this abstract explores the potential of social capital, the networks and norms of trust within a society, to act as a powerful antidote. However, the relationship between social capital and corruption is not always straightforward. Informal networks, while fostering trust, can also create opportunities for collusion and exclusion. Moreover, the effectiveness of social capital in combating corruption is contingent upon its equitable distribution within a society. Unequal access to social networks can exacerbate existing power imbalances and hinder collective action against corrupt elites. Panel regression anaylsis reveals that a 1 unit increase in social capital increases Corruption Perceptions Index (CPI) by 0.138891 units (100 is very clean and 0 is highly corrupt). In conclusion, while social capital is not a panacea for corruption, its potential to foster trust, norms of fairness, and collective action makes it a valuable tool in the fight against this complex phenomenon. Further research is needed to understand the specific contexts and mechanisms through which social capital can be most effectively harnessed to promote transparency, accountability, and ultimately, good governance regarding to fight against corruption. JEL Codes: D73, H26, O11

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Regulating local government debt in China: Intended and unintended consequences

You

2024

China Information

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This study integrates institutional and empirical analyses to investigate the intricate policies that regulate local government debt in China. It finds that, within a remarkably short period, China has skilfully incorporated local government debt into the local budget management system, thereby transforming it from a mere transaction between local governments and credit agencies to an intergovernmental fiscal relations framework. The study also establishes that the pivotal debt-regulating policies are more geared towards prioritizing the cost of debt over its scale. Official documents, statistical data, and in-depth interviews provide evidence to support these findings. Drawing on an analysis of county-level panel data in Sichuan Province, this study identifies two main effects of these policies. Primarily, the cost of local general debt may trigger the notorious soft budget constraint, thereby incentivizing county-level governments to depend more heavily on superior transfer payments. Additionally, the fiscal consolidation policy, which focuses on the cost of local special debt, may lower the debt ratio. However, it also has the unintended consequence of bolstering the local government’s reliance on land finance.

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Impact of Local Official Corruption on Local Government Debt in China: The Mediating Role of Government Investment Efficiency

Cited by 3 publications

References 78 publications

Geoeconomic and foreign policy implications of Vietnam’s economic dependency on China

Geoeconomic and foreign policy implications of Vietnam’s economic dependency on China

Corruption and Social Capital: Findings From Selected OECD Countries

Regulating local government debt in China: Intended and unintended consequences

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