Anti-corruptions and IPO Decision: Evidence from the Chinese Provincial Panel Data

21 Pages Posted: 15 Jul 2020

See all articles by Bingwei Chen

Bingwei Chen

Chinese Academy of Finance and Development

Guanglei Zhou

Central University of Finance and Economics (CUFE) - Chinese Academy of Finance and Development

Date Written: June 21, 2019

Abstract

Relationship between IPOs and Local political turnover has been disputed and studied (Piotroski and Zhang (2014)). In this paper, we further focus on the anti-corruption and IPOs, since 2012 Chairman Xi announced and conducted a series of action of "hit the tiger" in order to reduce the anti-corruption and pure discipline in CPC. By examining and testing provincial panel data, we found the demotion of provincial officials can affect IPO decisions of Chinese companies that are eligible to list, those who take advantage of the window where companies lose political connections can lead to certain resource allocation inefficiencies. Additionally, firms performance and ownership could also be influenced by such demotion and anti-corruption.

Keywords: anti-corruptions, IPO

JEL Classification: G30, R38

Suggested Citation

Chen, Bingwei and Zhou, Guanglei, Anti-corruptions and IPO Decision: Evidence from the Chinese Provincial Panel Data (June 21, 2019). Available at SSRN: https://ssrn.com/abstract=3632826 or http://dx.doi.org/10.2139/ssrn.3632826

Bingwei Chen

Chinese Academy of Finance and Development ( email )

39 South College Road
Haidian District
Beijing, Beijing 100081
China
18810739172 (Phone)

Guanglei Zhou (Contact Author)

Central University of Finance and Economics (CUFE) - Chinese Academy of Finance and Development ( email )

39 South College Road
Beijing
China

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