Can the construction of the social credit system improve the efficiency of corporate investment?

Based on the quasi-natural experiment of China's pilot reform of social credit system, this paper examines the effect and mechanisms of the construction of social credit system on corporate investment efficiency using the data of A-share listed companies in Shanghai and Shenzhen from 2005 to 2022. The study presents the following findings. First, the construction of social credit system significantly improves corporate investment efficiency, through three main paths: alleviating information asymmetry, improving internal corporate governance, and strengthening market competition pressure. Second, there is significant heterogeneity in the promotion effect of the construction of social credit system on corporate investment efficiency, which is more pronounced for non-state-owned enterprises and enterprises in monopolistic industries. Based on the above research conclusions, this paper puts forward policy suggestions such as establishing a comprehensive credit information sharing platform, promoting the credit rating system, strengthening credit supervision and risk early warning to improve the social credit system.