Does Improvement of the Social Credit Environment Facilitate Companies’ Introduction of Foreign Investment?— A Quasi-Natural Experiment of Social Credit System Reform Pilot Programs

Using China A-shares listed companies on the Shanghai Stock Exchange and Shenzhen Stock Exchange from 2008 to 2022 as research samples, this study explores the effect of an improved social credit environment on companies' introduction of foreign investment. The results shows that, the improvement of the social credit environment facilitates local companies' introduction of foreign investment; the reduction in agency costs and the improvement in information disclosure quality are potential mechanisms; for companies in regions less influenced by Confucian culture and those with a higher percentage of shares held by executives, the positive impact is more significant. This study provides evidence to support the positive impact of establishing a regional integrity culture on facilitating the introduction of foreign investment.