Related Party Transactions in China before and after the Share Structure Reform

摘要：

We study the relationship between firm value and related party transactions (RPTs) in China. We find that firm value (as measured by Tobins Q) is negatively related to RPTs but the relation becomes insignificant after controlling for corporate governance characteristics. Following Cheung, Rau and Stouraitis (2006), we use abnormal returns in response to announcements of RPTs as a direct measure of the impact of RPTs on firm value. We observe significantly negative abnormal returns before the Share Structure Reform. After the reform, the abnormal returns become insignificant. The evidence suggests that RPTs are not as detrimental to firm value after the reform as they were before the reform. This is consistent with our hypothesis that the reform increases the takeover pressure from external market and thus moderates controlling shareholders propensity to tunnel wealth via RPTs.

作者: Chuan-Yang Hwang Shaojun Zhang Yanjian Zhu

作者单位: Nanyang Business School,Nanyang Technological University,Singapore,639798

会议类型: 国际会议

会议名称: 2008年中国金融国际年会

会议地点: 大连

会议语种:英文

页码: 1-38

在线出版日期: 2008-07-02（万方平台首次上网日期，不代表论文的发表时间）