Home purchase restriction, real estate investment, and corporate innovation

Frontiers of Business Research in China

Qilin Wang¹  Weida Kuang²  Changyu Chen² 

[1] Department of Corporate Finance, School of Business, Hunan University, No.11 Lushan South Road, Yuelu District, 400082, Changsha, China;Department of Finance, Business School, Renmin University of China, 59 Zhongguancun Street, Haidian District, 100872, Beijing, China;

关键词: Home purchase restriction (HPR) expectation;    Real estate investment;    Non-real estate firms;    Corporate innovation;   

DOI  :  10.1186/s11782-020-00091-5

来源: Springer

【 摘 要 】

It is ubiquitous for non-real estate firms to conduct real estate business in China. Home purchase restriction (HPR) affects corporate innovation by dampening the real estate investment of non-real estate firms. The extant literature has examined the impact of HPR on corporate innovation, but it has not focused on the expectation of HPR and the endogeneity problem. Employing a dataset of 1830 listed non-real estate firms over the period 2009–2016, this research explores the expectation of HPR on corporate innovation based on the motivations for real estate investment in non-real estate firms. We demonstrate that HPR facilitates the enhancement of research and development (R&D) investment in non-real estate listed firms by hindering real estate investment, particularly for non-high-tech firms. The effects of HPR arrive at the crest in the third implementation year and remain steady thereafter. The real estate investment of non-real estate firms rebounds and the R&D investment declines along with the cancellation of HPR. Tackling the selection bias and endogeneity problems, the baseline results are also robust. Hence, HPR should serve as a long-term vehicle to improving corporate innovation, in addition to preventing housing speculation.

【 授权许可】

CC BY