Date: 17 Nov 2022 (Thu)
Capital Market Development: China and Asia
- Serial Entrepreneurship in China
17 Nov 2022, Thursday
10:00 am – 11:10 am, Thursday (Hong Kong Time, UTC+8)
[ Serial Entrepreneurship in China ]
This paper studies entrepreneurship and the creation of new ﬁrms in China through the lens of serial entrepreneurs, i.e. entrepreneurs who establish more than one ﬁrm, and their diﬀerences with non-serial entrepreneurs. Drawing on data on the universe of all ﬁrms in China, the authors document key facts about serial entrepreneurship in China since the early 1990s and develop a theoretical framework to rationalize the role of endowments, ability, and capital market frictions in their behavior. The authors also examine the key determinants of the sectoral choice for serial entrepreneurs’ second ﬁrms. Quantitatively, serial entrepreneurs are more productive, raise more capital, and operate larger ﬁrms than non-serial entrepreneurs. Moreover, serial entrepreneurs with greater liquidity and whose ﬁrms have relatively similar productivity are more likely to operate these ﬁrms concurrently rather than sequentially. The authors also ﬁnd that less productive serial entrepreneurs are more likely to switch sectors when establishing new ﬁrms, with the choice of sector inﬂuenced by considerations of risk diversiﬁcation, upstream and downstream linkages, and sectoral complementarities.
Loren BRANDT, Professor of Economics and Noranda Chair in Economics and International Trade, University of Toronto
Ruochen DAI, Assistant Professor, School of Economics, Central University of Finance and Economics
Gueorgui KAMBOUROV Professor, Department of Economics, University of Toronto
Kjetil STORESLETTEN, Richard and Beverly Fink Professor of Economics, University of Minnesota
Xiaobo ZHANG, Professor, Applied Economics, Peking University
Hui CHEN, Nomura Professor of Finance and Professor of Finance, Sloan School of Management, Massachusetts Institute of Technology
About the Webinar
Financial market development goes hand-in-hand with economic growth. The development of China's capital markets in terms of size, regulations, capability, and efficiency has been impressive. China may now even lead globally in some dimensions, notably e-payments systems. Yet, China's capital markets are still a work-in-progress facing both generic and unique challenges. Other Asian capital markets have even greater uneven development. Some in advanced Asian economies have acquired globally acclaimed reputation and capabilities while various regulatory and structural weaknesses dwarf others. Corporations and investors have been inclined to arbitrage cross-border regulatory and developmental gaps; so the very uneven status of capital markets across Asia is a policy issue for the governments in the entire region and perhaps globally. Analysing the positive and negative lessons in the functioning of Asia's capital markets, and identifying reforms and applications of technology that could further improve Asian capital markets' allocation efficiency, financial inclusion, and forewarning against reforms that might cause problems can benefit practitioners, policymakers and researchers, and can contribute significantly to overall prosperity.
The ABFER and the University of Chicago's Becker Friedman Institute China (BFI-China), in collaboration with National University of Singapore (NUS) Business School, Shanghai Advanced Institute of Finance (SAIF), The Chinese University of Hong Kong (CUHK) Department of Economics, CUHK-Shenzhen and Tsinghua University PBC School of Finance (Tsinghua PBCSF), hope to provide a virtual network to benefit researchers, policymakers, and practitioners from Asia and beyond.