Wives’ Empowerment and Corporate Financial Risk in Chinese Family Firms

15 Pages Posted: 28 Jan 2022

See all articles by Ying Wang

Ying Wang

Shandong University of Finance and Economics

Huimin Li

University of New Hampshire - Department of Accounting & Finance

Leng Ling

Georiga College & State University

Hongfeng Peng

Shandong University of Finance and Economics

Abstract

We investigate the economic empowerment of founders’ wives in public Chinese family firms. We show that female cofounders hold higher voting rights when their firms are headquartered in regions where gender stereotypes rooted in local social norms are less prevalent. We also find that firms whose female cofounders wield greater influence, through higher voting rights and more leadership roles, retain more cash, use lower financial leverage, and have lower earnings risk. Our findings have implications on the extension of wives’ marital power in the household to corporate decision-making, as well as on gender difference in the context of risk preference.

Keywords: Gender, Marriage, Family firms, Firm risk

JEL Classification: D10, G32

Suggested Citation

Wang, Ying and Li, Huimin and Ling, Leng and Peng, Hongfeng, Wives’ Empowerment and Corporate Financial Risk in Chinese Family Firms. Finance Research Letters, Vol. 44, 2022, Available at SSRN: https://ssrn.com/abstract=4015570

Ying Wang

Shandong University of Finance and Economics

Huimin Li (Contact Author)

University of New Hampshire - Department of Accounting & Finance ( email )

Durham, NH 03824
United States

Leng Ling

Georiga College & State University ( email )

Milledgeville, GA 31061-0490
United States

Hongfeng Peng

Shandong University of Finance and Economics ( email )

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