Do political connections improve corporate performance? Evidence from Chinese listed companies

Xiaoying Li and Yue Jin

Finance Research Letters, 2021, vol. 41, issue C

Abstract: By analyzing the data of private listed companies from 2007 to 2013, this article explores the relationship between political connections and enterprise performance. The study finds that listed companies with local political connections have better performance than those without such ties. Regionally, political connections in eastern and central China can effectively promote corporate performance, while political connections in the western region cannot effectively improve and may even inhibit corporate performance. Political connections from managerial personnels other than CEO can also affect firm performance. This article provides empirical evidence from Chinese listed companies for the relationship between political connections, corporate performance and regional characteristics.

Keywords: Political connections; Enterprise performance; Regional characteristics (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:41:y:2021:i:c:s1544612320316858

DOI: 10.1016/j.frl.2020.101871

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