Government Shareholding and the Value of China's Modern Firms

Lihui Tian

No 395, William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan

Abstract: This paper documents the ultimate shareholding structures of 826 corporations listed on China's stock market and finds large equity holdings of the government. Using a panel data set, this paper further finds that corporate value decreases with an increased size of government shareholding when the government is a small shareholder. When the government equity holding is sufficiently large, corporate value increases with increased government shareholding. This U-shaped relationship between government shareholding and corporate value is interpreted by the aggregated impacts of the grabbing and helping hands of the government shareholder.

Keywords: ownership structure; government shareholding; corporate governance (search for similar items in EconPapers)
JEL-codes: G15 G32 G34 L33 (search for similar items in EconPapers)
Pages: pages
Date: 2001-04-01
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Citations: View citations in EconPapers (29)

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