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How does government data openness affect cross-regional capital flow? Evidence from Chinese-listed firms’ off-site investment

Author

Listed:
  • Long, Yongguang
  • Zhang, Xiaoru
  • Wang, Long

Abstract

Transaction cost theory posits that information is a key factor in facilitating enterprise decision-making, yet its validity in the digital age remains to be tested. China's government data openness provides an opportunity to do so. This study examines the impact of government data openness on cross-regional capital flows using data from Chinese-listed companies between 2009 and 2022. We find that government data openness significantly facilitates cross-regional capital flows, with effects particularly pronounced for labor-intensive firms, firms with stronger governance capacity, and those with weaker government–business ties. Mechanism analysis shows that open government data promote capital movement by improving the external business environment and reducing institutional transaction costs. Further, we find that higher-quality data openness and greater local government fiscal transparency amplify these positive effects on cross-regional capital flows.

Suggested Citation

  • Long, Yongguang & Zhang, Xiaoru & Wang, Long, 2025. "How does government data openness affect cross-regional capital flow? Evidence from Chinese-listed firms’ off-site investment," Economic Modelling, Elsevier, vol. 152(C).
    • Handle: RePEc:eee:ecmode:v:152:y:2025:i:c:s0264999325002846
    DOI: 10.1016/j.econmod.2025.107289
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    Keywords

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    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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