Government facing fiscal pressures is a prevalent phenomenon worldwide. This study investigates how governments’ fiscal squeeze shapes non-listed firms’ privatization. To establish causality, we exploit a policy shock in China, the cancellation of agricultural tax, to document that the...

We investigate whether and how government fiscal squeeze affects local firms’ pollution emissions. To establish causality, we introduce a policy shock in China, namely, the canceling of agricultural taxes in 2005, to document that governments’ fiscal squeeze due to sudden tax decreases...