We examine how removing user anonymity affects social media’s ability to generate value-relevant information for the stock market. Using a difference-in-differences design that exploits the differential timing of adopting real-name verification policies by the two most popular investment-related social media websites in China, we find that content on the treated site becomes significantly more informative about future stock returns and earnings after the policy takes effect. This effect is primarily driven by continuing users who post more actively in the pre-period. Although these users post less after the policy, the informational content of their posts increases, suggesting greater prudence in expressing opinions. Our results strengthen for firms that attract regulatory scrutiny. Overall, our study suggests that real-name verification policies can discipline internet users and potentially improve the informativeness of investment-related social media, particularly in emerging markets where retail investors predominate.

In this article, we examine whether comovement in the stock prices of pairs of Chinese firms connected to the same political network are systematically shaped by the prevailing coordination versus competition incentives of that network’s politicians. We find strong evidence from 2000 to 2012 (Jiang’s and Hu’s regimes) that stock price comovement is affected by the embeddedness of the firm–politician ties within the network. Among pairs of firms connected to a network through a common politician, we document an increase in stock price comovement. For those pairs of firms connected to a common network via separate politicians (rather than a common politician), we document a relative decrease in stock price comovement. This negative effect suggests that politicians’ relationships within these political networks are generally adversarial rather than cooperative in nature. These results become significantly weaker during Xi’s regime from 2013 to 2017, suggesting that Xi’s anti-corruption campaign and state-owned enterprise reforms may have attenuated these political network effects on the firms. Our additional tests also show that stock price comovement becomes even more positive (negative) in settings which are expected to increase the coordination or decrease the competition (decrease the coordination or increase the competition) of the politicians.

This paper investigates why Chinese state-owned enterprises (SOEs) with strong political connections (i.e., politically connected firms) are more likely to list overseas than non-politically connected firms. We find that connected firms' post-overseas listing performance is worse than that of non-connected firms. This evidence suggests that connected firms' managers list their firms overseas for private (political) benefits. Consistent with this private benefits explanation, we further find that connected firms' managers are more likely to receive political media coverage or a promotion to a senior government position subsequent to overseas listing than domestic listing.

This paper tests the proposition that politicians and their affiliated firms (i.e., firms operating in their province) temporarily suppress negative information in response to political incentives. We examine the stock price behavior of Chinese listed firms around two visible political events—meetings of the National Congress of the Chinese Communist Party and promotions of high‐level provincial politicians—that are expected to asymmetrically increase the costs of releasing bad news. The costs create an incentive for local politicians and their affiliated firms to temporarily restrict the flow of negative information about the companies. The result will be fewer stock price crashes for the affiliated firms during these event windows, followed by an increase in crashes after the event. Consistent with these predictions, we find that the affiliated firms experience a reduction (an increase) in negative stock return skewness before (after) the event. These effects are strongest in the three‐month period directly preceding the event, among firms that are more politically connected, and when the province is dominated by faction politics and cronyism. Additional tests document a significant reduction in published newspaper articles about affected firms in advance of these political events, suggestive of a link between our observed stock price behavior and temporary shifts in the listed firms’ information environment.