The impact of bond market liberalization on accounting conservatism
利用债券通这一准自然实验，研究发现参与该计划的企业提高了会计稳健性，且这一效应在诉讼风险高、海外关注多的企业中更显著，最终降低了债务成本并减少了过度投资。
Abstract In a quasi‐natural experimental setting in which Bond Connect allows foreign investors to trade in the Chinese interbank bond market, we predict and find that firms subject to the program increase their accounting conservatism. Further analyses suggest that the increase is concentrated among firms with higher litigation risk, more corporate site visits and greater media attention from overseas, suggesting that foreign bond investors affect firms through the channel of bondholder litigation and monitoring. Additionally, we document that improvement in conservatism is more pronounced when foreign investors participate more and for firms with looser issuance criteria. We also find that enhanced conservatism results in a lower cost of debt for bonds in the liberalized market and those of the same issuers in the nonliberalized market, as well as lower overinvestments and fewer dividends. In addition, firms show greater conservatism in other forms of public disclosure. Together, these findings suggest that firms enhance accounting conservatism to facilitate foreign bond investors’ assessment of credit risk.