Associate Professor Ling Jin, a researcher of the base, has published a collaborative paper titled "Does stock market rescue affect investment efficiency in the real sector?" in the Journal of Financial Markets.

Abstract:

During China's stock market crash in 2015, the government purchased the stocks of over 1000 firms. We investigate how this government rescue affects investment efficiency and show that rescued firms experience a significant decrease in investment-q sensitivity. This rescue has an adverse impact on price efficiency and impedes managers from learning information for investment decisions. The learning channel is the main mechanism through which the rescue has a real effect. Our findings indicate that programs intended to stabilize the stock market could adversely affect the real efficiency, providing new insight into the consequences of government purchases.

Keywords: Stock market rescue; Government intervention; Investment efficiency; Learning from prices

Link: https://doi.org/10.1016/j.finmar.2023.100859

Teacher profile

Ling Jin, PhD, Associate Professor, School of Finance, Zhongnan University of Economics and Law. His research interests include financial development, financial crisis management and financial innovation. He has published several papers in Economic Research Journal, China Economic Quarterly, Journal of Management Science in China, Journal of Financial Research, Pacific-Basin Finance Journal and other journals. The relevant research has won the Excellent Paper Award of the First China Financial Academic and Policy Forum, the Excellent Paper Award of the 17th Annual Meeting of Financial Engineering, and the Excellent Paper of Financial Research in 2021, etc.