Corruption exposure, political disconnection, and their impact on Chinese family firms

Siwen Song, Aelee Jun and Shiguang Ma

Journal of Contemporary Accounting and Economics, 2021, vol. 17, issue 3

Abstract: This study adopts a quasi-natural experimental approach to examine the responses of Chinese family firms to political disconnection following exposure to corruption scandals. Our results are consistent with the view that family firms build political connections to achieve better performance, for access to external financing, and to secure more investment opportunities. We also find that the impact of political disconnection is more profound for firms located in provinces with a low level of marketisation, located in the same provinces as their related corrupt officials, and belonging to industries with high levels of corruption. Our results are robust after ruling out the impact of corruption cases per se as well as to alternative measurements of key variables and sample selection methods.

Keywords: Political connection; Corruption; Family firms; Corporate behaviour (search for similar items in EconPapers)
JEL-codes: D22 G32 G34 G38 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jocaae:v:17:y:2021:i:3:s1815566921000242

DOI: 10.1016/j.jcae.2021.100266

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