Notes: INV_t is corporate investment measured by capital expenditure deflated by total assets in year t. TOB_t−1 is Tobin’s Q measured by market value of equity plus book value of debt deflated by total assets in year t−1. IND_t is board independence measured by the fraction of independent directors on the board in year t. ROA_t−1 is firm profitability measured by return on assets in year t−1. LEV_t−1 is financial leverage measured by total liabilities deflated by total assets in year t−1. CAS_t−1 is cash holdings measured by cash and equivalents deflated by total assets in year t−1. SIZ_t−1 is firm size measured by the natural logarithm of total assets in year t−1. SOE_t is the state ownership dummy assigned 1 if at least 50 percent of shares are held by government agencies and 0 otherwise in year t. *,**,***Significant at 10, 5 and 1 percent levels, respectively