Abstract
We analyse the long-term stock performance of Chinese initial public offerings (IPOs) between the years of 2000 and 2007. The results reveal that firms with political connections experience better long-term stock performance. Our results suggest that the abolition of the Issuance Quota System and Channel Restriction System has a negative influence on the long-term performance of IPOs. This evidence is consistent with the view that local government officials are likely to select politically connected companies to go public.
| Original language | English |
|---|---|
| Pages (from-to) | 814-833 |
| Number of pages | 20 |
| Journal | Journal of International Financial Markets, Institutions and Money |
| Volume | 22 |
| Issue number | 4 |
| DOIs | |
| Publication status | Published - 2012 |
Keywords
- China
- Initial public offerings
- Long-term underperformance
- Political connections
- Regulations
ASJC Scopus subject areas
- Economics and Econometrics
- Finance
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Liu, J., Uchida, K., & Gao, R. (2012). Political connections and the long-term stock performance of Chinese IPOs. Journal of International Financial Markets, Institutions and Money, 22(4), 814-833. https://doi.org/10.1016/j.intfin.2012.05.005