*4.1. Data Collection*

The data collection started by taking all the Chinese A-listed firms over the period 2008 to 2016. However, we dropped firms based on the following criteria: (i) Firms belonging to financial sector. These firms have different accounting mechanisms and are not subject to current data collection process. (ii) Firms with ST (special treatment) and PT (particular treatment) status. These firms are financially distressed and may give spurious results. (iii) Firms with missing values for dependent, independent or control variables. (iv) We winsorized 1% of the data from upper and lower values to control for outliers. After all the adjustments, the final sample comprised 2248 firms. The data was extracted from the Chinese Stock Market and Research (CSMAR) database.
