Table 5 Endogeneity test Panel A:...

Table 5

Endogeneity test

Panel A: propensity score matching
	Unmatched			Matched
	Treat = 1	Treat = 0	t-stat.	Treat = 1	Treat = 0	t-stat.
Size	22.589	21.995	24.63	22.586	22.623	−1.12
Lev	0.494	0.520	−5.35	0.494	0.499	−1.11
PPE	0.226	0.261	−11.17	0.226	0.225	0.17
CFO	0.043	0.047	−2.53	0.043	0.043	−0.17
Age	2.604	2.282	28.62	2.603	2.624	−1.97
SOE	0.600	0.560	4.98	0.427	0.423	0.41
ROA	0.025	0.028	−2.60	0.025	0.026	−0.63
Board	2.275	2.287	−3.95	2.275	2.274	0.20
SalesGrowth	0.183	0.211	−2.46	0.183	0.182	0.05
Block	0.353	0.352	0.32	0.353	0.353	−0.02
GDP	11.351	10.942	36.58	11.350	11.367	−1.55
Peorat	6.292	5.234	11.51	6.287	6.224	0.47
Governfa	16.302	15.442	38.86	16.301	16.316	−0.57
Loan	18.608	17.675	36.41	18.607	18.609	−0.06
Event_city_sum	3.390	1.358	36.59	3.387	3.245	1.63

Panel A: propensity score matching
	Unmatched			Matched
	Treat = 1	Treat = 0	t-stat.	Treat = 1	Treat = 0	t-stat.
Size	22.589	21.995	24.63	22.586	22.623	−1.12
Lev	0.494	0.520	−5.35	0.494	0.499	−1.11
PPE	0.226	0.261	−11.17	0.226	0.225	0.17
CFO	0.043	0.047	−2.53	0.043	0.043	−0.17
Age	2.604	2.282	28.62	2.603	2.624	−1.97
SOE	0.600	0.560	4.98	0.427	0.423	0.41
ROA	0.025	0.028	−2.60	0.025	0.026	−0.63
Board	2.275	2.287	−3.95	2.275	2.274	0.20
SalesGrowth	0.183	0.211	−2.46	0.183	0.182	0.05
Block	0.353	0.352	0.32	0.353	0.353	−0.02
GDP	11.351	10.942	36.58	11.350	11.367	−1.55
Peorat	6.292	5.234	11.51	6.287	6.224	0.47
Governfa	16.302	15.442	38.86	16.301	16.316	−0.57
Loan	18.608	17.675	36.41	18.607	18.609	−0.06
Event_city_sum	3.390	1.358	36.59	3.387	3.245	1.63

Panel B: entropy balanced matching
	Before(without weighting)					After(weighting)
	Treat = 1		Treat = 0		Treat = 1		Treat = 0
	Mean	Skew.	Mean	Skew.	Mean	Skew.	Mean	Skew.
Size	22.590	0.501	22.000	0.465	22.590	0.501	22.590	0.502
Lev	0.494	0.005	0.520	3.947	0.494	0.005	0.494	0.005
PPE	0.226	0.834	0.262	0.655	0.226	0.834	0.226	0.834
CFO	0.043	−0.263	0.047	−0.138	0.043	−0.263	0.043	−0.263
Age	2.604	−1.210	2.282	−1.319	2.604	−1.210	2.603	−1.210
SOE	0.600	−0.407	0.558	0.269	0.600	−0.407	0.600	−0.407
ROA	0.025	−3.854	0.028	−3.217	0.025	−3.854	0.025	−3.854
Board	2.275	−0.143	2.287	−0.134	2.275	−0.143	2.275	−0.142
SalesGrowth	0.183	5.459	0.211	6.014	0.183	5.459	0.183	5.460
Block	0.353	0.436	0.352	0.440	0.353	0.436	0.353	0.437
GDP	11.350	−0.640	10.940	−0.590	11.350	−0.640	11.350	−0.638
Peorat	6.292	0.433	5.240	1.014	6.292	0.433	6.292	0.433
Governfa	16.300	−0.187	15.440	0.066	16.300	−0.187	16.300	−0.186
Loan	18.610	−0.684	17.670	−0.342	18.610	−0.684	18.611	−0.683
Event_city_sum	3.390	0.628	1.358	2.228	3.390	0.628	3.390	0.628

Panel B: entropy balanced matching
	Before(without weighting)					After(weighting)
	Treat = 1		Treat = 0		Treat = 1		Treat = 0
	Mean	Skew.	Mean	Skew.	Mean	Skew.	Mean	Skew.
Size	22.590	0.501	22.000	0.465	22.590	0.501	22.590	0.502
Lev	0.494	0.005	0.520	3.947	0.494	0.005	0.494	0.005
PPE	0.226	0.834	0.262	0.655	0.226	0.834	0.226	0.834
CFO	0.043	−0.263	0.047	−0.138	0.043	−0.263	0.043	−0.263
Age	2.604	−1.210	2.282	−1.319	2.604	−1.210	2.603	−1.210
SOE	0.600	−0.407	0.558	0.269	0.600	−0.407	0.600	−0.407
ROA	0.025	−3.854	0.028	−3.217	0.025	−3.854	0.025	−3.854
Board	2.275	−0.143	2.287	−0.134	2.275	−0.143	2.275	−0.142
SalesGrowth	0.183	5.459	0.211	6.014	0.183	5.459	0.183	5.460
Block	0.353	0.436	0.352	0.440	0.353	0.436	0.353	0.437
GDP	11.350	−0.640	10.940	−0.590	11.350	−0.640	11.350	−0.638
Peorat	6.292	0.433	5.240	1.014	6.292	0.433	6.292	0.433
Governfa	16.300	−0.187	15.440	0.066	16.300	−0.187	16.300	−0.186
Loan	18.610	−0.684	17.670	−0.342	18.610	−0.684	18.611	−0.683
Event_city_sum	3.390	0.628	1.358	2.228	3.390	0.628	3.390	0.628

Panel C: regression test
	(1)	(2)
	PSM-DID	EB-DID
	Debtcost	Debtcost
Event_25km	0.002^**	0.001^**
Event_25km	(2.502)	(1.981)
Size	0.004^***	0.003^***
Size	(5.816)	(7.073)
Lev	0.042^***	0.049^***
Lev	(12.461)	(17.439)
PPE	0.042^***	0.038^***
PPE	(12.608)	(13.395)
CFO	−0.020^***	−0.019^***
CFO	(−6.482)	(−5.622)
Age	0.008^***	0.009^***
Age	(3.733)	(5.825)
SOE	−0.000	−0.001
SOE	(−0.106)	(−0.805)
ROA	−0.010^**	−0.005
ROA	(−2.188)	(−1.124)
Board	−0.003	−0.003^*
Board	(−1.193)	(−1.803)
SalesGrowth	−0.000	−0.000
SalesGrowth	(−0.027)	(−0.825)
Block	−0.002	−0.004
Block	(−0.588)	(−1.625)
GDP	−0.002	−0.007^***
GDP	(−1.127)	(−3.531)
Peorat	0.000^***	0.000
Peorat	(2.695)	(1.621)
Governfa	0.002	−0.002
Governfa	(0.754)	(−1.111)
Loan	−0.004^*	0.000
Loan	(−1.806)	(0.140)
Event_city_sum	0.000	0.000
Event_city_sum	(0.129)	(0.322)
Cons	−0.038	0.001
Cons	(−0.951)	(0.038)
Firm FE	Yes	Yes
Year FE	Yes	Yes
Observations	11,218	21,258
Adj. R²	0.189	0.627

Panel C: regression test
	(1)	(2)
	PSM-DID	EB-DID
	Debtcost	Debtcost
Event_25km	0.002^**	0.001^**
Event_25km	(2.502)	(1.981)
Size	0.004^***	0.003^***
Size	(5.816)	(7.073)
Lev	0.042^***	0.049^***
Lev	(12.461)	(17.439)
PPE	0.042^***	0.038^***
PPE	(12.608)	(13.395)
CFO	−0.020^***	−0.019^***
CFO	(−6.482)	(−5.622)
Age	0.008^***	0.009^***
Age	(3.733)	(5.825)
SOE	−0.000	−0.001
SOE	(−0.106)	(−0.805)
ROA	−0.010^**	−0.005
ROA	(−2.188)	(−1.124)
Board	−0.003	−0.003^*
Board	(−1.193)	(−1.803)
SalesGrowth	−0.000	−0.000
SalesGrowth	(−0.027)	(−0.825)
Block	−0.002	−0.004
Block	(−0.588)	(−1.625)
GDP	−0.002	−0.007^***
GDP	(−1.127)	(−3.531)
Peorat	0.000^***	0.000
Peorat	(2.695)	(1.621)
Governfa	0.002	−0.002
Governfa	(0.754)	(−1.111)
Loan	−0.004^*	0.000
Loan	(−1.806)	(0.140)
Event_city_sum	0.000	0.000
Event_city_sum	(0.129)	(0.322)
Cons	−0.038	0.001
Cons	(−0.951)	(0.038)
Firm FE	Yes	Yes
Year FE	Yes	Yes
Observations	11,218	21,258
Adj. R²	0.189	0.627

Note(s): This table reports the results of the endogeneity test. Panel A shows the results of propensity score matching. Panel B shows the results of entropy-balanced matching. Panel C shows the regression results of the matched sample. Variable definitions are provided in Supplementary material. The regressions are performed using OLS. The t-statistics in parentheses are adjusted for heteroscedasticity and clustered by firm. ^***, ^** and ^* indicate two-tailed significance at the 1%, 5% and 10% levels, respectively

Source(s): Table created by authors

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