China's Closed Pyramidal Managerial Labor Market and the Stock Price Crash Risk
研究发现中国国企经理的政治级别越高，其所在公司的股价崩盘风险越低，这种效应在年轻经理、任期较短、市场力量弱、无外资、无政治关联的企业以及无政治晋升时期更显著。
ABSTRACT Managers of China's state-owned firms work in a closed pyramidal managerial labor market. They enjoy non-transferable benefits if they choose to stay within this system. The higher up are they in this labor market hierarchy (their political ranks), the fewer are their outside employment opportunities. Due to career and wealth concerns, they are cautious and risk-averse when managing firms. We examine the effect of managers' political ranks on firms' stock price crash risk and find a negative association. This association mainly exists in firms with younger managers and managers with shorter tenure. Further, this effect is only significant in regions with weak market forces, in firms without foreign investors, without political connections, and during periods with no local government leaders' or managers' political promotions. We conclude that the political ranking system reduces the stock price crash risk. JEL Classifications: G30; J33.