How Does Government Control Affect Firm Value? New Evidence for China

Summary The role of government involvement in firms has received a lot of attention in the last few decades. Government involvement could result in a ‘supporting hand’ and a ‘grabbing hand’. This paper investigates how government control influences the financial performance of Chinese listed firms. We use a panel data set of firms publicly traded on the stock exchanges of Shanghai and Shenzhen over the period 2009‐2013. Our dataset includes 5501...