Institutional Development and Controlling Shareholder’s Expropriation: Evidence from China

Wen-gui Li ()
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Wen-gui Li: Wuhan University

Chapter Chapter 16 in The 19th International Conference on Industrial Engineering and Engineering Management, 2013, pp 131-140 from Springer

Abstract: Abstract This paper argues that the possibility of political extraction can influence the controlling shareholder’s tunneling. We use the index of “relationship between government and market”, which is from the NERI, as the measure of institutional development, and the samples are the listed companies in China during 2003–2007. The paper shows that, when the possibility of political extraction is high, firms controlled by the large shareholder who has a less separation of control rights and ownership rights hold less cash than other firms, and more expropriation by the controlling shareholder.

Keywords: Cash holding; Controlling shareholder; Expropriation; Institutional development (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-642-38427-1_16

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DOI: 10.1007/978-3-642-38427-1_16

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