International oil price uncertainty and corporate investment: Evidence from China's emerging and transition economy

Y. Wang; E. Xiang; A.W.K. Cheung; W. Ruan; W. Hu

doi:10.1016/j.eneco.2016.11.024

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International oil price uncertainty and corporate investment: Evidence from China's emerging and transition economy

Journal article

Open access

Peer reviewed

International oil price uncertainty and corporate investment: Evidence from China's emerging and transition economy

Y. Wang, E. Xiang, A.W.K. Cheung, W. Ruan and W. Hu

Energy Economics, Vol.61, pp.330-339

2017

DOI: https://doi.org/10.1016/j.eneco.2016.11.024

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Abstract

We develop and estimate a dynamic model of investment to investigate the impact of international oil price uncertainty on corporate investment expenditures in China's emerging and transition economy. We further examine whether state ownership affects the relationship between oil price uncertainty and corporate investment. Consistent with the model's prediction, the main finding is that oil price uncertainty exerts a negative impact on corporate investment expenditures. In addition, compared with state-owned listed companies, the negative influence of oil price uncertainty on corporate investment is more significant for non-state-owned listed companies. Our further analysis, using the market-oriented reform of refined oil pricing in 2008 as a quasi-natural event, shows the variation between the low-degree marketization period and the high-degree one in terms of the relationship between international oil price uncertainty, state ownership and corporate investment expenditures.

Details

Title: International oil price uncertainty and corporate investment: Evidence from China's emerging and transition economy
Authors/Creators: Y. Wang (Author/Creator) - China University of Petroleum, East China
E. Xiang (Author/Creator) - Edith Cowan University
A.W.K. Cheung (Author/Creator)
W. Ruan (Author/Creator) - Murdoch University
W. Hu (Author/Creator) - Curtin University
Publication Details: Energy Economics, Vol.61, pp.330-339
Publisher: Elsevier B.V.
Identifiers: 991005541839007891
Copyright: © 2016 Elsevier B.V.
Murdoch Affiliation: School of Business and Governance
Language: English
Resource Type: Journal article

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Collaboration types: Domestic collaboration; International collaboration
Citation topics: 6 Social Sciences; 6.10 Economics; 6.10.80 Market Interdependencies
Web Of Science research areas: Economics
ESI research areas: Economics & Business