Managerial Power, Ownership and Stock Price Crash Risk

Yingkai Tang; Lu Xie; Weiping Li; Yang Meng

doi:10.1007/978-3-319-93351-1_49

Managerial Power, Ownership and Stock Price Crash Risk

Yingkai Tang
, Lu Xie
, Weiping Li^*
, Yang Meng

^*Corresponding author for this work

Department of Economics and Finance

Research output: Chapters, Conference Papers, Creative and Literary Works › RGC 32 - Refereed conference paper (with host publication) › peer-review

2 Citations (Scopus)

Abstract

Based on the data of A-share listed firms in China during 2005 to 2016, this paper studies the effect of managerial power on the stock price crash risk. The empirical results show that: (1) The stronger manager’s power leads to a lower stock price crash risk; (2) By dividing the sample into the state-owned firms and non-state-owned firms, we found that the negative effect of managerial power is only significant in the non-state-owned firms. To address the possible endogenous problems, we utilize the instrumental variable regression and simultaneous equations model to conduct the robust check and the results are consistent with our conclusion. This paper not only deepens the study on the influencing factors of the stock price crash risk, but also has great significance for how to prevent the crash of stock price through corporate governance and promote the healthy development of capital market.

Original language	English
Title of host publication	Proceedings of the Twelfth International Conference on Management Science and Engineering Management
Editors	Jiuping Xu, Fang Lee Cooke, Mitsuo Gen, Syed Ejaz Ahmed
Publisher	Springer
Chapter	49
Pages	619-632
ISBN (Electronic)	978-3-319-93351-1
ISBN (Print)	978-3-319-93350-4
DOIs	https://doi.org/10.1007/978-3-319-93351-1_49
Publication status	Published - Aug 2018
Event	12th International Conference on Management Science and Engineering Management (2018 ICMSEM) - Melbourne, Australia Duration: 1 Aug 2018 → 4 Aug 2018 http://www.icmsem.org/

Publication series

Name	Lecture Notes on Multidisciplinary Industrial Engineering
Publisher	Springer
ISSN (Print)	2522-5022
ISSN (Electronic)	2522-5030

Conference

Conference	12th International Conference on Management Science and Engineering Management (2018 ICMSEM)
Place	Australia
City	Melbourne
Period	1/08/18 → 4/08/18
Internet address	http://www.icmsem.org/

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10.1007/978-3-319-93351-1_49

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Tang, Y., Xie, L., Li, W., & Meng, Y. (2018). Managerial Power, Ownership and Stock Price Crash Risk. In J. Xu, F. L. Cooke, M. Gen, & S. E. Ahmed (Eds.), Proceedings of the Twelfth International Conference on Management Science and Engineering Management (pp. 619-632). (Lecture Notes on Multidisciplinary Industrial Engineering). Springer . https://doi.org/10.1007/978-3-319-93351-1_49

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title = "Managerial Power, Ownership and Stock Price Crash Risk",

abstract = "Based on the data of A-share listed firms in China during 2005 to 2016, this paper studies the effect of managerial power on the stock price crash risk. The empirical results show that: (1) The stronger manager{\textquoteright}s power leads to a lower stock price crash risk; (2) By dividing the sample into the state-owned firms and non-state-owned firms, we found that the negative effect of managerial power is only significant in the non-state-owned firms. To address the possible endogenous problems, we utilize the instrumental variable regression and simultaneous equations model to conduct the robust check and the results are consistent with our conclusion. This paper not only deepens the study on the influencing factors of the stock price crash risk, but also has great significance for how to prevent the crash of stock price through corporate governance and promote the healthy development of capital market. ",

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booktitle = "Proceedings of the Twelfth International Conference on Management Science and Engineering Management",

note = "12th International Conference on Management Science and Engineering Management (2018 ICMSEM) ; Conference date: 01-08-2018 Through 04-08-2018",

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Tang, Y, Xie, L, Li, W & Meng, Y 2018, Managerial Power, Ownership and Stock Price Crash Risk. in J Xu, FL Cooke, M Gen & SE Ahmed (eds), Proceedings of the Twelfth International Conference on Management Science and Engineering Management. Lecture Notes on Multidisciplinary Industrial Engineering, Springer , pp. 619-632, 12th International Conference on Management Science and Engineering Management (2018 ICMSEM), Melbourne, Victoria, Australia, 1/08/18. https://doi.org/10.1007/978-3-319-93351-1_49

Managerial Power, Ownership and Stock Price Crash Risk. / Tang, Yingkai; Xie, Lu; Li, Weiping et al.
Proceedings of the Twelfth International Conference on Management Science and Engineering Management. ed. / Jiuping Xu; Fang Lee Cooke; Mitsuo Gen; Syed Ejaz Ahmed. Springer , 2018. p. 619-632 (Lecture Notes on Multidisciplinary Industrial Engineering).

Research output: Chapters, Conference Papers, Creative and Literary Works › RGC 32 - Refereed conference paper (with host publication) › peer-review

TY - GEN

T1 - Managerial Power, Ownership and Stock Price Crash Risk

AU - Tang, Yingkai

AU - Xie, Lu

AU - Li, Weiping

AU - Meng, Yang

PY - 2018/8

Y1 - 2018/8

N2 - Based on the data of A-share listed firms in China during 2005 to 2016, this paper studies the effect of managerial power on the stock price crash risk. The empirical results show that: (1) The stronger manager’s power leads to a lower stock price crash risk; (2) By dividing the sample into the state-owned firms and non-state-owned firms, we found that the negative effect of managerial power is only significant in the non-state-owned firms. To address the possible endogenous problems, we utilize the instrumental variable regression and simultaneous equations model to conduct the robust check and the results are consistent with our conclusion. This paper not only deepens the study on the influencing factors of the stock price crash risk, but also has great significance for how to prevent the crash of stock price through corporate governance and promote the healthy development of capital market.

AB - Based on the data of A-share listed firms in China during 2005 to 2016, this paper studies the effect of managerial power on the stock price crash risk. The empirical results show that: (1) The stronger manager’s power leads to a lower stock price crash risk; (2) By dividing the sample into the state-owned firms and non-state-owned firms, we found that the negative effect of managerial power is only significant in the non-state-owned firms. To address the possible endogenous problems, we utilize the instrumental variable regression and simultaneous equations model to conduct the robust check and the results are consistent with our conclusion. This paper not only deepens the study on the influencing factors of the stock price crash risk, but also has great significance for how to prevent the crash of stock price through corporate governance and promote the healthy development of capital market.

U2 - 10.1007/978-3-319-93351-1_49

DO - 10.1007/978-3-319-93351-1_49

M3 - RGC 32 - Refereed conference paper (with host publication)

SN - 978-3-319-93350-4

T3 - Lecture Notes on Multidisciplinary Industrial Engineering

SP - 619

EP - 632

BT - Proceedings of the Twelfth International Conference on Management Science and Engineering Management

A2 - Xu, Jiuping

A2 - Cooke, Fang Lee

A2 - Gen, Mitsuo

A2 - Ahmed, Syed Ejaz

PB - Springer

T2 - 12th International Conference on Management Science and Engineering Management (2018 ICMSEM)

Y2 - 1 August 2018 through 4 August 2018

ER -

Tang Y, Xie L, Li W, Meng Y. Managerial Power, Ownership and Stock Price Crash Risk. In Xu J, Cooke FL, Gen M, Ahmed SE, editors, Proceedings of the Twelfth International Conference on Management Science and Engineering Management. Springer . 2018. p. 619-632. (Lecture Notes on Multidisciplinary Industrial Engineering). Epub 2018 Jun 26. doi: 10.1007/978-3-319-93351-1_49

Managerial Power, Ownership and Stock Price Crash Risk

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