The impact of involvement in targeted poverty alleviation on corporate investment efficiency

Corporate social responsibility has received increasing attention in recent decades. In this paper, we investigate how corporate involvement in poverty alleviation affects investment efficiency. Based on the context of China, we find that involvement in targeted poverty alleviation improves enterprises' investment efficiency through two channels: 1) resource effect, which alleviates enterprises' underinvestment by obtaining strategic resources, and 2) governance effect, which reduces enterprises' agency conflict and reduces enterprises' overinvestment and underinvestment. This study enriches our understanding of the determinants of corporate investment efficiency and the economic consequences of targeted poverty alleviation. In addition, our findings also provide policy implications for both regulators to encourage enterprises to actively fulfill their social responsibilities and promote their high-quality development.& COPY; 2023 Economic Society of Australia, Queensland. Published by Elsevier B.V. All rights reserved.