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The employment effects of anticorruption: Evidence from China

Author

Listed:
  • Xu, Xiangbing
  • Dong, Nanyan
  • Wu, Chengzhang
  • Luo, Sicheng

Abstract

This study examines whether China's anticorruption efforts affect firm employment. We find that Chinese provinces with higher pre-existing levels of corruption experience significant increases in the employment scale of listed firms post-campaign. Two channels through which anticorruption affects employment are identified: the mitigation of expropriation risk and the alleviation of financing pressure. The employment effects are more pronounced in firms with higher labor costs, lower management fees, and those located in regions with weaker marketization. Moreover, the campaign can mitigate underhiring and its effects on employment will not come at the expense of compensation or firm profitability.

Suggested Citation

  • Xu, Xiangbing & Dong, Nanyan & Wu, Chengzhang & Luo, Sicheng, 2025. "The employment effects of anticorruption: Evidence from China," Emerging Markets Review, Elsevier, vol. 66(C).
    • Handle: RePEc:eee:ememar:v:66:y:2025:i:c:s1566014125000391
    DOI: 10.1016/j.ememar.2025.101290
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    More about this item

    Keywords

    Anticorruption; Employment effects; Resource reallocation; Labor investment efficiency;
    All these keywords.

    JEL classification:

    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • P30 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - General

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