Do Banks Favor Political-Connected Firms
碩士 === 國立彰化師範大學 === 財務金融技術學系 === 102 === This paper investigates the relationship between political connection and firm’s bank loan rates in Taiwan listed companies. The sample period is yearly ranged from 2004 to 2012. We construct measure of political connection by searching the firm’s specific po...
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| Format: | Others |
| Language: | zh-TW |
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2014
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| Online Access: | http://ndltd.ncl.edu.tw/handle/14554086170882463257 |
| Summary: | 碩士 === 國立彰化師範大學 === 財務金融技術學系 === 102 === This paper investigates the relationship between political connection and firm’s bank loan rates in Taiwan listed companies. The sample period is yearly ranged from 2004 to 2012. We construct measure of political connection by searching the firm’s specific political preference in all of the newspapers of Taiwan during sample period. The ordinary least squares estimation result indicates that firms with higher political connection tend to get lower bank loan rates. Furthermore, we examine if political connection in different ruling party still matters. We find that the political connection effect exists during DPP ruling sample period but disappeared in KMT ruling sample period. Also we use two-stage estimation to deal with self-selection bias. In addition, quantile regression and regression with lagged explanatory variables provide more robust evidence. General results support positive view of political connection in lieu of lower bank lending rate. Political connection has capital market benefit.
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