Government intervention in investment by Chinese listed companies that have diversified into tourism

Caiping Wang and Honggang Xu

Tourism Management, 2011, vol. 32, issue 6, 1371-1380

Abstract: This paper presents the outcome of empirical research into the influences of government intervention on tourism investment using a sample of Chinese listed companies that have diversified into the tourism sector. Government intervention is measured on the basis of the CEO’s political connections, the relationship between the government and the market, and the degree of financial market development. The results show that state-owned enterprises (SOEs) with strong political connections are likely to diversify into the tourism industry, especially in the area in which the government intervenes in the market excessively and the financial market is well-developed, although the tourism businesses of these firms tend to operate poorly after diversification. Amongst non-SOEs, in contrast, government intervention factors are not found to facilitate diversification into the tourism sector to any significant degree. Less government intervention is found to be beneficial for these firms, allowing them to improve their performance in the tourism sector. It is thus concluded that greater local government awareness of policy implementation is necessary to avoid unfair competition between SOEs and non-SOEs and to target the long-term positive development of the Chinese tourism sector.

Keywords: Tourism diversification; Institutional environment; Government intervention; Tourism investment (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S026151771100015X

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:touman:v:32:y:2011:i:6:p:1371-1380

DOI: 10.1016/j.tourman.2011.01.012

Access Statistics for this article

Tourism Management is currently edited by Chris Ryan

More articles in Tourism Management from Elsevier
Bibliographic data for series maintained by Catherine Liu ().