Government subsidies and corporate disclosure*

• 成果类型: Article
• 署名作者: Huang, Ying
• 署名单位: University of Texas System; University of Texas Dallas
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2022.101480
• 发表日期: 2022
• 关键词: voluntary disclosure; EARNINGS FORECASTS; incentives; COMPETITION; FIRMS; TRANSPARENCY; politicians

摘要

Government subsidies allocated by politicians are ultimately funded by taxpayers, who care about how tax money is spent and demand transparency. I argue that subsidized firms, as beneficiaries of government subsidies, have incentives to provide more disclo-sures to help politicians achieve a reputation for transparency as well as to lower their own costs from public scrutiny. Using a novel dataset that tracks government subsidies, I provide the first large-sample evidence on the relation between government subsidies and firm disclosure. I find that relative to unsubsidized firms, subsidized firms provide more voluntary disclosures of general information about their business activities and profit-ability, as well as more disclosures of subsidy-goal-related information, such as job crea-tion and capital investment. Further, these associations are stronger for firms operating in or obtaining subsidies from states whose politicians reveal a stronger preference for subsidy transparency, and for firms that are more likely to attract public scrutiny. (c) 2022 Elsevier B.V. All rights reserved.