Political connections and the long-term stock performance of Chinese IPOs

Jianlei Liu, Konari Uchida, Ruidong Gao

Research output: Contribution to journalArticle

26 Citations (Scopus)

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 languageEnglish
Pages (from-to)814-833
Number of pages20
JournalJournal of International Financial Markets, Institutions and Money
Volume22
Issue number4
DOIs
Publication statusPublished - Jul 6 2012

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics

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