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      The “heterogeneous” effect of government grants on bank lending

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          Abstract

          This study aims to test whether banks can recognize different signals from different types of government grants received by their clients and respond differently. Using a novel panel data set from China, we construct a three-way fixed-effect regression model and empirically explore the effect of government grants received by banks’ clients on banks’ lending decisions. We find that banks have heterogeneous attitudes towards their clients when the clients receive different types of government grants. In particular, we discover that banks behave positively toward clients who receive "development supportive" grants but negatively toward clients who receive "helping hand" grants. The main results hold after a series of robustness tests. Our study offers fresh perceptions on how banks see government grants of their clients while making lending choices. Our finds will offer certain inspirations for government grant policies and bank lending decisions.

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          Job Market Signaling

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            Estimation of Relationships for Limited Dependent Variables

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              Economic Welfare and the Allocation of Resources for Invention

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                Author and article information

                Contributors
                Role: Writing – original draftRole: Writing – review & editing
                Role: Resources
                Role: Editor
                Journal
                PLoS One
                PLoS One
                plos
                PLOS ONE
                Public Library of Science (San Francisco, CA USA )
                1932-6203
                11 December 2023
                2023
                : 18
                : 12
                : e0289375
                Affiliations
                [1 ] School of Finance and Economics, Jiangsu University, Zhenjiang, Jiangsu, China
                [2 ] WHU-DUFE Management Control Research Center, Dongbei University of Finance and Economics, Dalian, Liaoning, China
                Shanghai Business School, CHINA
                Author notes

                Competing Interests: The authors have declared that no competing interests exist.

                Author information
                https://orcid.org/0000-0001-8674-581X
                Article
                PONE-D-23-03790
                10.1371/journal.pone.0289375
                10712854
                38079391
                9e916f9d-55ad-42d6-a53d-a41002bdc314
                © 2023 Gu, Zhang

                This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

                History
                : 9 February 2023
                : 17 July 2023
                Page count
                Figures: 4, Tables: 8, Pages: 19
                Funding
                Funded by: Jiangsu Provincial Social Science Fund Finance Special
                Award ID: 2022SCB-37
                Award Recipient :
                Jiangsu Provincial Social Science Fund Finance Special (2022SCB-37). The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.
                Categories
                Research Article
                Social Sciences
                Economics
                Finance
                Public Finance
                Money Supply and Banking
                Social Sciences
                Economics
                Finance
                Social Sciences
                Political Science
                Governments
                Biology and Life Sciences
                Psychology
                Psychological Attitudes
                Social Sciences
                Psychology
                Psychological Attitudes
                Earth Sciences
                Geography
                Human Geography
                Urban Geography
                Cities
                Social Sciences
                Human Geography
                Urban Geography
                Cities
                Social Sciences
                Economics
                Information Economics
                Asymmetric Information
                Research and Analysis Methods
                Mathematical and Statistical Techniques
                Statistical Methods
                Instrumental Variable Analysis
                Physical Sciences
                Mathematics
                Statistics
                Statistical Methods
                Instrumental Variable Analysis
                Science Policy
                Research Funding
                Government Funding of Science
                Custom metadata
                The raw data of this paper can be downloaded from the China Stock Market & Accounting Research Database (CSMAR). The link is https://www.gtarsc.com. An account is needed to get authorized to log in.

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