What do we learn from stock price reactions to China's first announcement of anti-corruption reforms? / Chen Lin, Randall Morck, Bernard Yeung, Xiaofeng Zhao.

Format:

Book

Author/Creator:

Lin, Chen.

Contributor:

National Bureau of Economic Research.

Morck, Randall.

Yeung, Bernard.

Zhao, Xiaofeng.

Series:

Working Paper Series (National Bureau of Economic Research) no. w22001.

NBER working paper series no. w22001

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2016.

Summary:

China's markets gained 3.86% around December 4, 2012, when the Party announced anti-corruption reforms. State-owned enterprises (SOEs) with higher past entertainment and travel costs (ETC) gained more. NonSOEs gained in more liberalized provinces, especially those with high past ETC, productivity, growth opportunities, and external financing. NonSOEs lost in the least liberalized provinces, especially those with high past ETC. These findings support investors' expect reduced official corruption to create value overall, reduce SOE waste, lower bureaucratic barriers to efficient resource allocation where markets function, and impede business in unliberalized provinces, where "getting things done" still requires investment in greasing bureaucratic gears.

Notes:

Print version record

February 2016.