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Uneven tax enforcement and cross-regional capital flows: The role of economic resilience and industrial agglomeration

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  • Fu, Mingyue
  • Zhu, Pengfei

Abstract

Based on data linking Chinese listed firms and their subsidiaries from 2006 to 2023, this study constructs a balanced panel dataset at the “parent firm–potential destination region–year” level. Taking firms’ interregional investment activities as a proxy for cross-regional capital flows, the paper investigates how regional disparities in tax enforcement impact cross-regional capital flows. The results reveal that greater regional disparities in tax enforcement intensity significantly promote cross-regional capital flows, indicating that regions with weaker tax enforcement intensity attract more cross-regional investments from listed companies. Furthermore, both economic resilience and industrial agglomeration positively moderate this relationship.

Suggested Citation

  • Fu, Mingyue & Zhu, Pengfei, 2026. "Uneven tax enforcement and cross-regional capital flows: The role of economic resilience and industrial agglomeration," Finance Research Letters, Elsevier, vol. 92(C).
    • Handle: RePEc:eee:finlet:v:92:y:2026:i:c:s1544612326000632
    DOI: 10.1016/j.frl.2026.109532
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