Privatization effect versus listing effect: Evidence from China

Bo Li, William L. Megginson, Zhe Shen and Qian Sun

Pacific-Basin Finance Journal, 2019, vol. 56, issue C, 369-394

Abstract: Previous studies show that profitability does not improve after share issue privatization (SIP) in China. We explore the possibility that the positive privatization effect can be overwhelmed by a negative listing effect, leading to an overall negative or insignificant SIP profitability change. Using the difference-in-differences approach with various matched samples, we show that there is a positive privatization effect and there is a negative listing effect on profitability. We also document evidence of a significant improvement in profitability after separating the “pure” privatization effect from the SIP effect. Our findings are robust to alternative variable specifications and methodological changes.

Keywords: Privatization; Listing; Difference-in-differences; Government policy and regulation (search for similar items in EconPapers)
JEL-codes: G15 G32 G38 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0927538X19301544
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:56:y:2019:i:c:p:369-394

DOI: 10.1016/j.pacfin.2019.07.001

Access Statistics for this article

Pacific-Basin Finance Journal is currently edited by K. Chan and S. Ghon Rhee

More articles in Pacific-Basin Finance Journal from Elsevier
Bibliographic data for series maintained by Catherine Liu ().