Does The Belt And Road Initiative Reduce Enterprise Violations?

High-quality development is the theme of economic and social development during the "Fourteenth Five-Year Plan" period.The report of the 20 th CPC National Congress pointed out that high-quality development is the primary task of building a socialist modern country in an all-round way.While enterprises are the micro foundation of market economy,so the legal operation of enterprises is the premise of high-quality development of China’s economy.In recent years,with the rapid development of the economy and the increasingly complex business activities of enterprises,the phenomenon of enterprise violations is endless.The number of violation cases such as information disclosure,market manipulation,insider trading,and illegal operation has remained high.The cases are characterized by complex and hidden means,large amounts of money involved,and prominent recidivism problems.This not only brings great challenges to the supervision,but also is not conducive to the construction of the market economic environment in China and hinders the economic development of China.In the new phase,high-quality development must adhere to a high level of opening-up.The Belt and Road initiative has changed the business environment of Chinese enterprises and affected their strategic choices.Research shows that the financial pressure,poor performance and other difficulties of enterprises will increase the risk of violations,but enterprises supported by the initiative have better operating environment and higher operating performance,which will have an impact on enterprise violations.Therefore,based on the quasi-natural experiment of the initiative,this paper analyzes the impact of the initiative on corporate violations and its mechanism by using the annual data of Chinese A-share listed companies in Shanghai and Shenzhen from 2010 to 2019.The research results show that:(1)After the implementation of the initiative,the violation behavior of enterprises is significantly inhibited,and the violation tendency and violation frequency of relevant enterprises are lower.This conclusion is still valid after the propensity score matching method controls the potential endogenous problems.Moreover,in enterprises with better internal control and higher external supervision,the initiative has a more significant inhibitory effect on enterprise violations.(2)The result of mechanism analysis shows that the initiative not only alleviates the financing constraints,but also improves the quality of information disclosure,thus restraining the illegal behavior of enterprises.(3)Heterogeneity analysis shows that the initiative has a significant inhibitory effect on the violations of enterprises in state-owned,key industries and key provinces,but has no significant inhibitory effect on violations involving individual behavior.Put forward policy recommendations based on the empirical results.First,enterprises should participate in the initiative,improve their business conditions through legal operation,and improve the ability to resist risks.Second,the government should use policies and media to reduce the opportunities for enterprises to violate regulations.Third,the government should consider the difficulties that enterprises may face and adopt policies to alleviate the pressure of enterprises.Fourth,the government should consider the nature,location and industry of enterprise,and play the role of policy guidance and organization coordination.Let the relevant policies of the initiative benefit more enterprises.This paper enriched the research framework of the "the Belt and Road" initiative and enterprise micro behavior,and provide some evidence support for the initiative to help Chinese enterprises regulate their operations.