THE RELATIONSHIP BETWEEN INSTITUTIONAL CAPITAL OPERATING AND FINANCIAL PERFORMANCE OF RETURNING INDUSTRY TRANSFER PARTICIPATING IN RURAL REVITALIZATION
Received: 19.09.2021; Revised: 28.10.2021, Accepted: 26.11.2021, Published Online: 20.12.2021
Fairtown Zhou Ayoungman
Professor, Yunus Social Business Center of Zhengzhou University & School of business department, Zhengzhou University, Zhengzhou 450001, Henan, China, Email: Ayoungman@zuaa.zju.edu.cn
Interested in New institutional economics and business management theory
Papel Tanchangya
Phd Candidate, Yunus Social Business Center of Zhengzhou University & School of business department Zhengzhou University, Zhengzhou 450001, Henan, China
Email: tan_papel@qq.com; papeltan@gs.zzu.edu.cn
Interested in New institutional economics and Rural studies
Abstract: In China, returning industry transfer is a successful model for economic growth and rural revitalization. It has advantages in increasing employment, increasing income, raising taxes, developing infrastructure building, building production platforms, promoting industry agglomeration, contributing to social norms and governance policy, promoting rural revitalization, and promoting regional economic growth. Institutional value has been established in the paper, which sets the stage for the transformation from institution to institutional capital. Many scholars believe that institutional capital has a significant impact on the development of modern society. There are numerous definitions of the term based on a variety of theoretical frameworks. “Institutional capital” refers to the external or internal institutional context that contributes to a company’s ability to establish and maintain a competitive advantage. Institutional capital is rooted in the pursuit of legitimacy through a shared cognitive framework. Institutional capital can be defined as the favourable resources and various forms of government support that are acquired through a relational network. Permanently owned (tangible and intangible) assets are a company’s resources in a more formal sense, while the scarce flow of production, goodwill, patents, know-how technology and institutional capital made up by different institutions such as customers and communities can be viewed as resources. Institutional capital has a primary attribute of intangible capital, which is the ability to grow. Financial performance is used by analysts and investors to compare companies in the same industry or to compare the overall industry or sector. It is the company’s ability to generate and manage revenues, assets, liabilities, and the financial interests of its stockholders that is measured in financial performance. The second industry and other industries are more likely to obtain institutional capital in the process, which affects their financial performance. In the methodology chapter, the researcher has consistedof a sample of 376 returning industry transfer enterprises and described by the regression analysis and exclusion criteria in data sets are used. In this empirical research, the researcher describes the returning industry transfer participation system can significantly impact earnings per share index, profitability, short-term debt-payment ability, growth ability, and dividend payment ability of the institutional capital operating in rural areas. Institutional capital is gained in foreign direct investment when the host country’s political stability and institutional maturity are comparable to or worse.
Keywords: Returning industry transfer, institutional capital, rural revitalization, financial performance, enterprise nature.