Political connections, overinvestments and firm performance: Evidence from Chinese listed real estate firms

被引：75
|
作者：
Ling, Leng [1 ]
Zhou, Xiaorong [2 ]
Liang, Quanxi [3 ]
Song, Pingping [4 ]
Zeng, Haijian [3 ]
机构：
[1] GCSU, Bunting Coll Business, Milledgeville, GA USA
[2] Southwestern Univ Finance & Econ, Sch Publ Finance & Taxat, Chengdu, Sichuan, Peoples R China
[3] Guangxi Univ, Sch Business, Nanning, Guangxi, Peoples R China
[4] Georgia Gwinnett Coll, Sch Business, Lawrenceville, GA USA
来源：
FINANCE RESEARCH LETTERS | 2016年 / 18卷
关键词：
Political connection; Real estate; Overinvestment; Firm performance; FREE CASH FLOW; CEO OVERCONFIDENCE; CORPORATE; ACQUISITIONS; INVESTMENT;
D O I：
10.1016/j.frl.2016.05.009
中图分类号：
F8 [财政、金融];
学科分类号：
0202 ;
摘要：
Using a sample of 103 listed real estate firms from 1998 to 2012, this paper examines the influence of firms' political connections on external financing, corporate investment, and financial performance. The results indicate that political connections are negatively related to return on assets. Moreover, firms with stronger connections are financed with more long-term bank loans and are more likely to overinvest, which partially explains the puzzle of adverse effect of political connections on performance. Taken together, our results suggest that cultivating political connections could be a risky investment and may not always pay off. (C) 2016 Elsevier Inc. All rights reserved.
引用
收藏
页码：328 / 333
页数：6
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