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Can executive equity incentives enhance corporate debt-paying ability?—An analysis based on the moderating mechanism of patient capital

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  • Fang, Fang
  • Chen, Dan

Abstract

Based on data from Chinese A-share listed companies in Shanghai and Shenzhen from 2011 to 2023, this study constructs a panel model to analyze the specific impact of executive equity incentives on corporate debt-paying capacity, and innovatively incorporates patient capital as a moderating variable into the analytical framework. Empirical results indicate that executive equity incentives are significantly positively correlated with corporate debt-paying capacity; patient capital plays a substantial moderating role in the transmission path by which executive equity incentives affect debt-paying capacity; the effect of executive equity incentives on corporate debt-paying capacity is more pronounced in private enterprises (PEs) than in state-owned enterprises (SOEs); and the enhancement of debt-paying capacity through executive equity incentives is significantly stronger in high-tech enterprises compared to non-high-tech enterprises.

Suggested Citation

  • Fang, Fang & Chen, Dan, 2025. "Can executive equity incentives enhance corporate debt-paying ability?—An analysis based on the moderating mechanism of patient capital," International Review of Economics & Finance, Elsevier, vol. 102(C).
    • Handle: RePEc:eee:reveco:v:102:y:2025:i:c:s1059056025005106
    DOI: 10.1016/j.iref.2025.104347
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