شهرت، اطلاعات حسابداری و قراردادهای بدهی در شرکت های خانوادگی چینی

This paper provides evidence to show that in the presence of imperfect formal institutions there is both a substitutional and a complementary relationship between accounting information and reputation, an informal institution. Empirical results using a sample of family firms listed in the Chinese A-share stock market from 2004 to 2007 show that in China, where the legal environment is far from perfect, the complementary relationship between reputation and accounting information is more pronounced than is the substitutional relationship. Thus, the aggregate effect is that a better reputation improves the usefulness of accounting information in debt contracts. Besides the aggregate effect, this paper also provides evidence of the substitutional and complementary relationships between reputation and accounting separately.

Coase (1937) shows that the costs of entering into and executing contracts and managing organizations, and these costs that are neglected by traditional microeconomic theory, can be employed to interpret the reasons for a firm's existence. He then extends these costs to form the concept of “transaction costs.” In a world of positive transaction costs, the contracting parties will try to minimize (given constraints) contracting costs. Positive accounting theory (PAT), as formulated by Watts and Zimmerman and other researchers, views accounting as part of a set of efficient contracts that are agreed by the firm and its stakeholders (see Watts and Zimmerman (1986) for a summary of related PAT literature from the 1970s). The three major hypotheses proposed by PAT, namely, the bonus plan, debt contract and political cost hypotheses, are all based on the assumption that accounting information can reduce contracting costs. A natural question that arises is: What is the relationship between accounting information and the other institutional arrangements that can also reduce these costs? The prior literature, much of which constitutes cross-country studies, has examined the relationship between accounting information and the other formal institutional arrangements that can also reduce contracting costs, such as legal origin, legal enforcement and public policies. Transaction cost economics, as established by Williamson (1979), however, argues that in reality the most common way to solve contract disputes is not through a formal institution, but rather through the informal institutions that are formed by repeated games among the transaction parties and are known as “private order” institutions. Informal institutions can also remedy some of the defects of formal institutions (Lin, 1994), and it is thus meaningful to examine them. Because of data collection difficulties (Sun et al., 2005) and the problems of omitted variables and measurement bias (Gul, 2006), it is difficult for cross-country studies to examine the effects of informal institutions and the relationship between these institutions and accounting information. At the same time, informal institutions guarantee the self-enforcement of contracts and thus do not rely on any third party outside the contracting relationship such as the courts. In the face of imperfect formal institutions, transactions are more reliant on informal institutions. Hence, I expect it to be easier to observe the way in which informal institutions aid the enforcement of contracts. China, an emerging market, provides a unique setting for such an investigation. Sun et al. (2006) show that the usefulness of accounting information in debt contracts is less pronounced in state-owned enterprises (SOEs) than in non-SOEs. After ruling out alternative explanations, they conclude that the government's reputation serves as guarantee that SOEs will repay their bank loans, thereby weakening the usefulness of accounting information. Reputation is a self-enforcing informal institution (Klein et al., 1978; Williamson, 1979). It serves to render the present value of future gains when the contract is honored greater than that of current gains when it is breached. Reputation thus gives the contracting parties the incentive to honor the contract. In line with Sun et al. (2006), “debt contract” in this paper refers to a firm's ability to borrow from banks, and is measured in the empirical analysis by newly acquired bank loans in a given year.1 This study extends Sun et al. (2006) in two aspects. First, by employing the transaction cost economics framework, it shows that reputation and accounting information have both a substitutional and complementary relationship in debt contracts. On the one hand, both reputation and accounting information can monitor borrowers and reduce their opportunistic behavior, which means that reputation can substitute for accounting information in preventing such behavior. On the other hand, accounting information provides useful information about the borrowers' ability to repay the debt. Reputation enhances the credibility of such information, thereby improving the usefulness of accounting information in debt contracts and suggesting a complementary relationship between reputation and accounting information. Second, Sun et al. (2006) present only indirect evidence of the effect of reputation, whereas this study attempts to measure the reputation of family firms and provides direct evidence of its effect. The empirical results of the study reported herein, which adopted a sample of all family firms listed in the Chinese A-share stock market from 2004 to 2007, show that in China, where formal institutions are far from perfect, the complementary relationship between reputation and accounting information is more pronounced than is the substitutional relationship. Thus, the aggregate effect is that a better reputation improves the usefulness of accounting information in debt contracts. This paper also provides evidence of both the substitutional and complementary relationships between reputation and accounting, and examines alternative implications of the reputation variables. When control variables for privatization type, controlling shareholder, differences in the information environment and accounting information quality are included, the prior conclusion that a stronger reputation improves the usefulness of accounting information in debt contracts remains unchanged. Additional tests show that (1) analysts' private information weakens the complementary relationship between reputation and accounting information, and (2) banks require a lower degree of conditional conservatism from firms with a better reputation, which suggests that reputation substitutes for the governance role of accounting information. Moreover, there is weak evidence to suggest that the effects of reputation are lessened as the legal environment improves. In contrast to the prior literature, which focuses on the relationship between accounting information and formal institutions, this study investigates the relationship between accounting information and reputation, an informal institution, using the transaction cost economics framework. It also offers a preliminary attempt to measure the reputation of family firms. China, one of the world's largest transition economies, is characterized by weak formal institutions. As a result, a large number of the country's transactions rely on informal institutions. Such a unique setting provides numerous opportunities for research whose results will have important implications for the economic activities of other transition economies. Reputation, which is examined herein, is only one type of informal institution. Future studies may incorporate other informal institutions, such as business networks and culture, and may also investigate the contracts between firms and other stakeholder, including suppliers, customers and employees. As the restrictions on the listing of private companies in China are gradually being eliminated, future research may employ larger samples, compare family firms and non-family firms directly, and use panel data to avoid such econometrics problems as serial correlation, thereby allowing more accurate and credible conclusions to be reached.

This study has investigated the relationship between accounting and reputation, an informal institution, in debt contracts in a setting characterized by an imperfect institutional environment. Creditors enjoy a poor level of protection in China, which does little to restrict borrowers' ex post opportunistic behavior. Although the governance role of accounting information can restrict opportunistic behavior, it usually fails in the presence of severe such behavior because the governance role of accounting information is based on the assumption of an explicit contract. Severe opportunistic behavior also impairs the information role of accounting information. Although reputation can substitute for the governance role of such information, it provides banks with little information by which to evaluate a firm's repayment ability. Although reputation may restrict opportunistic behavior, banks still require further accounting information to evaluate firms' repayment ability, thereby restoring the information role of accounting information. There is thus both a substitutional and complementary relationship between reputation and accounting information. The empirical results of this study, which was based on a sample of family firms listed in China's Chinese A-share stock market from 2004 to 2007, show that in China, where formal institutions are weak, the complementary relationship between reputation and accounting information is more pronounced than is the substitutional relationship. Thus, the aggregate effect is that a strong reputation improves the usefulness of accounting information in debt contracts. Additional tests show that (1) analysts' private information weakens the complementary relationship between reputation and accounting information and that (2) banks require a lower degree of conditional conservatism from firms with a better reputation, which suggests that reputation can substitute for the governance role of accounting information. Moreover, there is weak evidence to suggest that the effect of reputation is diminished as the legal environment improves. In contrast to the prior literature, which focuses on the relationship between accounting information and formal institutions, this study has investigated the relationship between such information and reputation, an informal institution, within the transaction cost economics framework, and has documented both a substitutional and complementary relationship between them. The study also offers a preliminary attempt at measuring the reputation of family firms and provides direct evidence of the way in which reputation has an effect. In China, which is characterized by weak formal institutions, large numbers of transactions rely on informal institutions. Such a unique setting provides numerous opportunities for research whose results will have important implications for the economic activities of other transition economies. It is suggested that future research employ larger samples, compare family firms and non-family firms directly, and use panel data to avoid such econometrics problems as serial correlation, thereby allowing more accurate and credible conclusions to be reached.