Table 7 Entropy balancing approach...

Table 7

Entropy balancing approach

	Financial_D = 1	Financial_D = 0
Variables used in the matching	Mean	Mean
Panel A before entropy balancing (unweighted)
SOE	0.329	0.432
Size	21.940	21.900
Age	1.988	2.013
Tangibility	0.927	0.933
Lev	0.442	0.438
RD	0.012	0.015
ROA	0.040	0.039
Growth	0.267	0.202
Duality	0.275	0.245
Independence	0.373	0.371
Female	0.177	0.170
Loss	0.092	0.098
TotalAccruals	0.002	−0.005
TMT_Age	3.820	3.837
TMT_Foreign	0.058	0.044
TMT_Academic	0.084	0.076
Panel B after entropy balancing (weighted)
SOE	0.329	0.329
Size	21.940	21.940
Age	1.988	1.988
Tangibility	0.927	0.927
Lev	0.442	0.442
RD	0.012	0.012
ROA	0.040	0.040
Growth	0.267	0.267
Duality	0.275	0.275
Independence	0.373	0.373
Female	0.177	0.177
Loss	0.092	0.092
TotalAccruals	0.002	0.002
TMT_Age	3.820	3.820
TMT_Foreign	0.058	0.058
TMT_Academic	0.084	0.084

	Financial_D = 1	Financial_D = 0
Variables used in the matching	Mean	Mean
Panel A before entropy balancing (unweighted)
SOE	0.329	0.432
Size	21.940	21.900
Age	1.988	2.013
Tangibility	0.927	0.933
Lev	0.442	0.438
RD	0.012	0.015
ROA	0.040	0.039
Growth	0.267	0.202
Duality	0.275	0.245
Independence	0.373	0.371
Female	0.177	0.170
Loss	0.092	0.098
TotalAccruals	0.002	−0.005
TMT_Age	3.820	3.837
TMT_Foreign	0.058	0.044
TMT_Academic	0.084	0.076
Panel B after entropy balancing (weighted)
SOE	0.329	0.329
Size	21.940	21.940
Age	1.988	1.988
Tangibility	0.927	0.927
Lev	0.442	0.442
RD	0.012	0.012
ROA	0.040	0.040
Growth	0.267	0.267
Duality	0.275	0.275
Independence	0.373	0.373
Female	0.177	0.177
Loss	0.092	0.092
TotalAccruals	0.002	0.002
TMT_Age	3.820	3.820
TMT_Foreign	0.058	0.058
TMT_Academic	0.084	0.084

Dependent variable = ETR1
Dependent variable = ETR1	(1)	(2)	(3)	(4)
Panel C multivariate results
Financial_D	−0.006*
Financial_D	(−1.726)
Financial_Ratio		−0.026*
Financial_Ratio		(−1.906)
RegulatoryFinancial			0.016
RegulatoryFinancial			(0.780)
NonregulatoryFinancial			−0.007**
NonregulatoryFinancial			(−2.025)
RegulatoryFinancial_Ratio				0.053
RegulatoryFinancial_Ratio				(0.740)
NonregulatoryFinancial_Ratio				−0.030*
NonregulatoryFinancial_Ratio				(−1.831)
SOE	0.005	0.005	0.004	0.005
SOE	(0.972)	(0.987)	(0.917)	(0.972)
Size	0.011***	0.011***	0.011***	0.011***
Size	(5.879)	(5.775)	(5.880)	(5.785)
Age	−0.000	0.000	−0.000	0.000
Age	(−0.042)	(0.113)	(−0.078)	(0.053)
Tangibility	0.018	0.019	0.019	0.018
Tangibility	(0.802)	(0.814)	(0.827)	(0.807)
Lev	0.033***	0.033***	0.033***	0.033***
Lev	(2.701)	(2.690)	(2.688)	(2.686)
RD	−0.637***	−0.647***	−0.639***	−0.641***
RD	(−4.549)	(−4.607)	(−4.601)	(−4.583)
ROA	0.125***	0.127***	0.123***	0.126***
ROA	(3.246)	(3.299)	(3.193)	(3.271)
Growth	0.013***	0.013***	0.012***	0.013***
Growth	(3.804)	(3.826)	(3.789)	(3.832)
Duality	−0.002	−0.002	−0.002	−0.002
Duality	(−0.488)	(−0.459)	(−0.494)	(−0.453)
Independence	−0.015	−0.015	−0.015	−0.015
Independence	(−0.478)	(−0.462)	(−0.460)	(−0.458)
Female	0.024	0.025	0.025	0.025
Female	(1.322)	(1.340)	(1.334)	(1.340)
Loss	−0.010	−0.010	−0.010	−0.010
Loss	(−0.944)	(−0.930)	(−0.947)	(−0.935)
TotalAccruals	0.010	0.009	0.010	0.009
TotalAccruals	(0.390)	(0.376)	(0.404)	(0.381)
TMT_Age	−0.034	−0.036	−0.033	−0.035
TMT_Age	(−1.287)	(−1.361)	(−1.233)	(−1.304)
TMT_Foreign	0.038**	0.038**	0.037**	0.038**
TMT_Foreign	(1.985)	(2.022)	(1.981)	(2.018)
TMT_Academic	0.013	0.014	0.012	0.013
TMT_Academic	(1.022)	(1.083)	(0.960)	(1.025)
_cons	−0.069	−0.058	−0.075	−0.063
_cons	(−0.647)	(−0.541)	(−0.699)	(−0.591)
Year fixed effects?	Yes	Yes	Yes	Yes
Industry fixed effects?	Yes	Yes	Yes	Yes
Province fixed effects?	Yes	Yes	Yes	Yes
No. of obs	18,253	18,253	18,253	18,253
Adj. R-square	0.075	0.076	0.076	0.076

Dependent variable = ETR1
Dependent variable = ETR1	(1)	(2)	(3)	(4)
Panel C multivariate results
Financial_D	−0.006*
Financial_D	(−1.726)
Financial_Ratio		−0.026*
Financial_Ratio		(−1.906)
RegulatoryFinancial			0.016
RegulatoryFinancial			(0.780)
NonregulatoryFinancial			−0.007**
NonregulatoryFinancial			(−2.025)
RegulatoryFinancial_Ratio				0.053
RegulatoryFinancial_Ratio				(0.740)
NonregulatoryFinancial_Ratio				−0.030*
NonregulatoryFinancial_Ratio				(−1.831)
SOE	0.005	0.005	0.004	0.005
SOE	(0.972)	(0.987)	(0.917)	(0.972)
Size	0.011***	0.011***	0.011***	0.011***
Size	(5.879)	(5.775)	(5.880)	(5.785)
Age	−0.000	0.000	−0.000	0.000
Age	(−0.042)	(0.113)	(−0.078)	(0.053)
Tangibility	0.018	0.019	0.019	0.018
Tangibility	(0.802)	(0.814)	(0.827)	(0.807)
Lev	0.033***	0.033***	0.033***	0.033***
Lev	(2.701)	(2.690)	(2.688)	(2.686)
RD	−0.637***	−0.647***	−0.639***	−0.641***
RD	(−4.549)	(−4.607)	(−4.601)	(−4.583)
ROA	0.125***	0.127***	0.123***	0.126***
ROA	(3.246)	(3.299)	(3.193)	(3.271)
Growth	0.013***	0.013***	0.012***	0.013***
Growth	(3.804)	(3.826)	(3.789)	(3.832)
Duality	−0.002	−0.002	−0.002	−0.002
Duality	(−0.488)	(−0.459)	(−0.494)	(−0.453)
Independence	−0.015	−0.015	−0.015	−0.015
Independence	(−0.478)	(−0.462)	(−0.460)	(−0.458)
Female	0.024	0.025	0.025	0.025
Female	(1.322)	(1.340)	(1.334)	(1.340)
Loss	−0.010	−0.010	−0.010	−0.010
Loss	(−0.944)	(−0.930)	(−0.947)	(−0.935)
TotalAccruals	0.010	0.009	0.010	0.009
TotalAccruals	(0.390)	(0.376)	(0.404)	(0.381)
TMT_Age	−0.034	−0.036	−0.033	−0.035
TMT_Age	(−1.287)	(−1.361)	(−1.233)	(−1.304)
TMT_Foreign	0.038**	0.038**	0.037**	0.038**
TMT_Foreign	(1.985)	(2.022)	(1.981)	(2.018)
TMT_Academic	0.013	0.014	0.012	0.013
TMT_Academic	(1.022)	(1.083)	(0.960)	(1.025)
_cons	−0.069	−0.058	−0.075	−0.063
_cons	(−0.647)	(−0.541)	(−0.699)	(−0.591)
Year fixed effects?	Yes	Yes	Yes	Yes
Industry fixed effects?	Yes	Yes	Yes	Yes
Province fixed effects?	Yes	Yes	Yes	Yes
No. of obs	18,253	18,253	18,253	18,253
Adj. R-square	0.075	0.076	0.076	0.076

Note(s): This table presents the results of the entropy balancing analysis. Panels A and B summarize the mean values of control variables for the treatment group and the control group before and after applying the entropy balancing method, respectively. Panel C provides the regression results based on entropy balancing. All independent variables are lagged by one year except for Growth and Loss. Detailed variable definitions can be found in Table A1 of the Appendix section. ***, **, and * denote significance at the 1%, 5%, and 10% levels, respectively

Source(s): Authors’ own work

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