Raising short-term debt for long-term investment and stock price crash risk: Evidence from China

By Feiyang Cheng, C. Chiao, Zhenming Fang, Chunfeng Wang, Shouyu Yao. 2020

121 citations recorded by the source corpus.

Abstract The purpose of this paper is to investigate the impact of raising short-term debt for long-term investment (SDFLI) on stock price crash risk. Using data from China's stock market, this paper provides insights not only on the consequences of SDFLI but also the underlying channels through which SDFLI affects crash risk. Evidence shows that SDFLI leads to less information disclosure, higher information risk, and lower information transparency, which eventually exacerbates future crash risk. Moreover, the effect of SDFLI on crash risk is affected by firm characteristics, monitoring mechanisms, and economic environment.

Subfields: Accounting, Finance

View Paper: https://www.semanticscholar.org/paper/0ef8b57d87d8145e999c6fee1eb000763d1292b0

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. Feiyang Cheng
2. Shouyu Yao
3. Yuying Pan
4. Gazi Salah Uddin
5. Ahmet Sensoy

In Finance

1. Gazi Salah Uddin
2. Ahmet Sensoy

Citations in the corpus

• Green credit policy and firm performance: What we learn from China (2021, background): “Although non-SOEs have stronger profitability, they are generally considered to have poor credit (Brandt and Li, 2003).”