This paper uses segmented dual-class shares of Chinese firms—A shares traded in mainland China by local investors and H shares traded in Hong Kong by foreign investors—to document a rich pattern in the differential reactions of local and foreign investors to analyst recommendations. This pattern reveals that social connections between analysts and investors affect investor reactions to analyst recommendations. Because of the investors' differential reactions, analyst recommendations may exacerbate, rather than attenuate, the market segmentation between the two share classes.

This paper examines the impact of general partners' (GPs) own investment (capital commitment) in the venture capital (VC) fund they manage on their investment behavior and fund performance. Using a unique dataset with detailed information on VC fund ownership structure, we find that GPs' capital commitment has an inverted U-shaped relationship with investment speed, investment distance, and industry specialization. GPs' capital commitment is also associated with greater exit success. These effects are more pronounced for VC funds with less monitoring by limited partners (LPs). Findings of this paper shed new light on the governance role of managerial ownership in the VC industry and on the GP-LP relationship.

This paper examines bank fund reallocation and regional economic growth based on 1991–2005 provincial-level data of four state-owned commercial banks of China that practice fund reallocation nation-wide. We find no correlation between bank fund reallocation and regional economic growth or between bank loans and regional economic growth. We find, however, a positive association between bank deposits and growth. It appears economic growth leads financial development in China, not the other way around. Furthermore, as China’s market-oriented reforms deepen, fund reallocation and loans start to manifest positive effects on growth even though the banks are government owned.

This paper uses segmented dual-class shares of Chinese firms—A shares traded in mainland China by local investors and H shares traded in Hong Kong by foreign investors—to document a rich pattern in the differential reactions of local and foreign investors to analyst recommendations. This pattern reveals that social connections between analysts and investors affect investor reactions to analyst recommendations. Because of the investors’ differential reactions, analyst recommendations may exacerbate, rather than attenuate, the market segmentation between the two share classes. Received January 28, 2016; editorial decision October 23, 2016 by Editor Robin Greenwood.

Given the importance of research resource allocation within brokerage firms, we examine key factors that influence the issuance of individual versus team analyst reports. Using a comprehensive sample of analyst reports from China for the 2008–2021 period, we find that this decision is influenced by (1) the brokerage firm's client interests, whereby firms held by the brokerage firm's mutual fund clients and firms that are the brokerage firm's underwriting clients receive more team than individual reports from the brokerage firm, and (2) the nature of corporate events, whereby routine events receive more team reports and nonroutine events receive more individual reports. Additional analyses suggest that analysts' personal traits and analyst team characteristics also affect the decision. Our findings further the understanding of the factors that affect the organization and resource allocation of sell‐side equity research.

A number of studies have investigated the causes and effects of stock market crashes. These studies mainly focus on the factors leading to a crash and on the volatility and co-movements of stock market indexes during and after the crash. However, how a stock market crash affects individual stocks and if stocks with different financial characteristics are affected differently in a stock market crash is an issue that has not received sufficient attention. In this paper, we study this issue by using data for eight major stock market crashes that have taken place during the December 31, 1962–December 31, 2007 period with a large sample of US firms. We use the event-study methodology and multivariate regression analysis to study the determinants of stock returns in stock market crashes.