Cross-listings, Government Intervention, and Efficiency of Capital Allocation
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| Title | Cross-listings, Government Intervention, and Efficiency of Capital Allocation
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| Author | Qin Jiaqi |
| Organization | Business School, Nankai University |
| Email | qjq@nankai.edu.cn |
| Key Words | Cross-listings; Government Intervention; Efficiency of Capital Allocation; Corporate Value |
| Abstract | Based on 2070 observations of a balanced panel data set from 2007 to 2011, we investigate whether China’s H+A cross-listed companies get lower efficiency of capital allocation and then achieve lower market value because of greater government intervention. Adopting the method of parametric function of production, we apply the total factors productivity (TFP) and technical efficiency (TE) to measure the static efficiency of capital allocation. The dynamic efficiency of capital allocation is measured by total factors productivity growth (TFPG) and its sub-index---technological progress, scale economy change, and technical efficiency change. With the treatment effect model, we find that H+A companies have lower TFP, TE, and TFPG. Meanwhile, the lower TFPGs of H+A companies come from lower technological progress. The treatment effect model with interaction shows that the lower efficiency of capital allocation decreases the value of H+A companies. These results can be viewed as a cost of China’s imposed institutional changes. |
| Serial Number | WP608 |
| Time | 2014-08-05 |
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