Abstract
Restricted by the factors of institutional system and information asymmetry, private firms are confronted with serious credit discrimination in the bank financing. Based on extant literatures studying the loan effect of political connections, this paper investigates the correlations between the political connections of private enterprises and bank loan pricing. The result of this paper indicates that political connections of private firms have the debt cost effect, thereby hel** private firms finance with relatively low bank loan rates, which provides the new proof of the impact of political relationship on the credit discrimination that private corporates encounter from the bank loan pricing perspective for the extant literatures.
This paper is supported by the fund of China Hunan Provincial Science & Technology Department (No. 2010FJ6033).
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Chen, Gr., Li, Qs., Ding, Cm. (2013). Do Political Connections of Private Enterprises Impact Bank Loan Pricing. In: Qi, E., Shen, J., Dou, R. (eds) The 19th International Conference on Industrial Engineering and Engineering Management. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-37270-4_65
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DOI: https://doi.org/10.1007/978-3-642-37270-4_65
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