Star academicians: Gimmicks or game-changers?

Conggang Li, Rong Xu and Yifan Zhou

Journal of Corporate Finance, 2023, vol. 82, issue C

Abstract: This paper examines the benefits of having an executive or director elected as a fellow of the Chinese Academies of Sciences and Engineering (i.e., a star academician). Evidence indicates that markets react positively to news of company executives/directors being elected. We further document that having a fellow spurs innovation, brings additional government subsidy, increases Tobin's q, lowers costs of capital, attracts analyst attention, and suppresses audit fees in the years following successful elections. These outcomes appear to be largely driven by fellows who (i) are executives rather than non-executive directors, and (ii) have held no government office.

Keywords: Chinese science; Board of directors; Social connections; Matthew effect; Certification effect (search for similar items in EconPapers)
JEL-codes: D7 D82 G14 G3 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:82:y:2023:i:c:s0929119923001013

DOI: 10.1016/j.jcorpfin.2023.102452

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