Foreign-funded firms and stock price informativeness: Evidence from Chinese capital markets

Jianhao Gao and Zhenzhou Tu

International Review of Economics & Finance, 2025, vol. 103, issue C

Abstract: This study investigates the potential impact of foreign-funded firms on the stock price informativeness of China's capital market. The study utilizes data from China's A-share listed firms spanning from 2011 to 2022. The findings reveal a significant positive correlation between foreign-funded firms and stock price informativeness. Furthermore, the study demonstrates that the positive relationship between foreign-funded firms and stock price informativeness is more pronounced in samples exhibiting higher levels of social responsibility than in those with lower levels. Similarly, in samples characterized by higher levels of product market competition, the positive relationship between foreign-funded firms and stock price informativeness is more significant than in samples with lower levels of competition. The conclusions remain robust after addressing potential endogeneity concerns using four distinct methodological approaches.

Keywords: Foreign-funded firms; Stock price informativeness; Social responsibility; Product market competition (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:103:y:2025:i:c:s1059056025005945

DOI: 10.1016/j.iref.2025.104431

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