Abstract:

During the process of economic transformation, the operational risks of enterprises have sharply increased. Exploring the healthy development of high–risk enterprises is crucial for resolving financial risks and protecting the interests of creditors. This article takes the establishment of bankruptcy courts as a quasi natural experiment and constructs a triple difference model to explore the impact and underlying mechanism of enhanced creditor protection on short–term loans and long- term investments of high risk enterprises. Research has found that the establishment of bankruptcy courts significantly exacerbates the more aggressive short–term lending and long-term investment behavior of high bankruptcy risk enterprises. Mechanism analysis shows that the establishment of bankruptcy courts significantly enhances the long-term investment and short–term financing of high bankruptcy risk enterprises, thereby exacerbating the degree of short–term loans and long–term investments of enterprises. Heterogeneity analysis shows that the establishment of bankruptcy courts exacerbates the effect of short–term loans and long–term investments, which is more significant in samples of low governance level enterprises, over- confident management,"two highs and one surplus" industries, and regions with low financial development levels; Com- pared to bankruptcy liquidation courts, independent bankruptcy courts have a greater impact on short–term loans and long- term investments of high-risk bankruptcy enterprises. Economic analysis reveals that the short–term loans and long–term investments of high-risk bankruptcy enterprises increase the probability of default, which may ultimately harm the interests of creditors.This study reveals the economic effects of creditor protection in China from the perspective of high bankruptcy risk enterprises, which has certain reference value for the design of bankruptcy system and financial risk prevention. 

Key words:

bankruptcy court, short-term loans and long-term investments, high risk enterprises

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