Faculty of Business Administration

FBE Brown Bag Seminar

Capital Account Liberalization and Innovation: Firm-level Evidence from 43 Countries


Prof. Xinpeng XU

Professor of Economics, Hong Kong Polytechnic University



Using a novel firm-level panel data set covering 43 countries over two decades, we show that capital account liberalization is significantly associated with higher firm patenting activity. We find that the positive impact is driven by a ‘productivity channel’ whereby firms that are bigger and more productive generate more innovation after liberalization. We do not find that the impact works through a ‘financial constraint’ channel. Moreover, the impact is stronger for firms having better corporate governance or located in economies with better legal environments. Our results provide the first global firm-level evidence on the innovation effect of capital account liberalization.


Date:          13 Dec 2019 (Friday)

Time:          15:00-16:30

Venue:        E22-2007

Short Biography

Prof. Xinpeng XU is Professor of Economics in School of Accounting and Finance, Faculty of Business, the Hong Kong Polytechnic University. He is also Director of Faculty of Business – Belt and Road Centre, the Hong Kong Polytechnic University and a Research Associate at the Australia-Japan Research Centre, the Australian National University, Australia. His research expertise lies in the areas of International Economics, Chinese Economy, Growth and Productivity, as well as Institution and Foreign Direct Investment. He is the recipient of Hong Kong Research Grant Council’s competitive General Research Fund (2015; 2017). He is also the recipient of Faculty Prize for Outstanding Performance/Achievement in Teaching in 2014 (Faculty of Business). Professor XU was Visiting Professor to many leading universities in the world and was invited to give Public Lecture at Peking University in China, among others. Prof. XU has many years’ experience in teaching at the level of MBA, EMBA, DBA and Doctor of Management in both Mainland China and Hong Kong. He has published papers in reputable international refereed journals such as Journal of International Money and Finance, Canadian Journal of Economics, Economic Inquiry, China Economic Review, Economica, Applied Economics, Economic Modeling, Journal of Asian Economics, Japanese Economics Review, Economics Letters, Review of World Economics, and World Development. He serves as Co-Editor of Journal of Chinese Economic and Business Studies, Senior Editor of China Accounting and Finance Review and an Executive Committee member of the Hong Kong Economic Association. Professor XU served as a consultant to international organizations such as OECD (Organization for Economic Co-operation and Development) and APEC (Asia Pacific Economic Cooperation). He graduated from Xiamen University, China with a B.A. and a M.A. in Economics and received his Ph.D. in Economics from the Australian National University, Australia.