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Corporate ownership,debt,and expropiation: Evidence from China/ Yunxia Bai

By: Contributor(s): Material type: TextTextSeries: China Journal of Accounting Studies ; Volume 1 , number 1 ,Taylor and Francis: Oxon, 2013Content type:
  • text
Media type:
  • unmediated
Carrier type:
  • volume
ISSN:
  • 2169-7221
Subject(s): Online resources: Summary: We provide direct evidence on the dark side of leverage and offer new insights regarding the role of debt in corporate governance. Using a sample of Chinese state-owned enterprises that have experienced a transfer of controlling rights, we find a positive and significant relationship between expropriation and debt usage. Firms controlled by private block shareholders tend to have higher leverage due to excessive expropriation via debt. The evidence we document provides fresh insights into the impact of debt on the agency problem between the controlling shareholder and minority shareholders, and suggests the presence of expropriation through debt and its conditional effect on corporate ownership.
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Holdings
Item type Current library Call number Vol info Copy number Status Notes Date due Barcode
Journal Article Journal Article Main Library - Special Collections HF5660 CHI (Browse shelf(Opens below)) Vol 1, No 1 pages 13-32 SP17843 Not for loan For In-house use only

We provide direct evidence on the dark side of leverage and offer new insights regarding the role of debt in corporate governance. Using a sample of Chinese state-owned enterprises that have experienced a transfer of controlling rights, we find a positive and significant relationship between expropriation and debt usage. Firms controlled by private block shareholders tend to have higher leverage due to excessive expropriation via debt. The evidence we document provides fresh insights into the impact of debt on the agency problem between the controlling shareholder and minority shareholders, and suggests the presence of expropriation through debt and its conditional effect on corporate ownership.

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