Manuscript_IRFA re-submission_20210822.pdf (581 kB)
Market discipline or rent extraction: impacts of share trading by foreign institutional investors in different corporate governance and investor protection environments
journal contribution
posted on 2023-06-10, 01:47 authored by Qiyu ZhangQiyu Zhang, Xiaoxiang ZhangXiaoxiang Zhang, Ding Chen, Roger StrangeRoger StrangeMinority investors' reliance on market discipline can vary with different country-level investor protection and firm-level corporate governance environments, which affect both discipline and rent extraction incentives of foreign institutional investors (FIIs). Using data from 47 economies between 2009 and 2017, we find that firm value increases with FIIs aggressive trading but decreases with FIIs discreet trading. The positive and negative impacts of FIIs trading are strengthened when investor protection is stronger, but weakened when corporate governance is stronger. Our analysis enhances understanding of trade-offs of FIIs trading between discipline and rent extraction in different corporate governance and investor protection environments.
Funding
Sustainable investing by mutual funds and their transparency level to end investors: the impacts on managerial myopic R&D investment behaviour; G2968; BRITISH ACADEMY; SRG1920/101581
History
Publication status
- Published
File Version
- Accepted version
Journal
International Review of Financial AnalysisISSN
1057-5219Publisher
ElsevierExternal DOI
Volume
79Page range
1-13Article number
a101965Department affiliated with
- Accounting and Finance Publications
Research groups affiliated with
- Business and Finance Research Group Publications
Full text available
- Yes
Peer reviewed?
- Yes
Legacy Posted Date
2021-12-02First Open Access (FOA) Date
2023-05-08First Compliant Deposit (FCD) Date
2021-12-01Usage metrics
Categories
No categories selectedKeywords
Licence
Exports
RefWorks
BibTeX
Ref. manager
Endnote
DataCite
NLM
DC