Research On The Effect Of Stock Pledge On Stock Price Crash Risk Based On Controlling Shareholders' Tunneling

Recently,stock pledge has been commonly welcomed by listed companies.During 2016,1635 companies have pledged their stock shares,and stock pledge totally occurred 11681 times.Although the controlling shareholders' stock pledge could satisfy their cash needs to some extent,it also reflects their financial constraints and fund demands.Thus,in financial distress,will the controlling shareholders' stock pledge aggravate their tunneling behavior and finally lead to higher stock price crash risk?Based on the above context,this paper sets stock pledge issued in the period of 2009~2016 by A-share listed company,as the research sample.Based on the principal-agent theory,private benefits of control theory,asymmetric inf ormation theory and management information manipulation theory,this paper uses the method of OLS to study the impact of the controlling shareholders' stock pledge on stock price crash,and through which exact way does the controlling shareholders' stock pledge influence stock price crash.The results show that,compared with firms without stock pledge by controlling shareholders,firms whose shares used to be collaterals have higher stock price crash risk;what is more,controlling shareholders' tunneling behavior plays a mediating role in the impact of stock pledge on stock price crash risk.Besides,we study the impact of property right on the relationship between controlling shareholders' pledge and stock price crash risk.This further study shows that the degree of the effect above for private enterprises is more important than state-owned enterprises.Finally,based on the theoretical and empirical research results,we propose the following relevant policy recommendations from the perspective of listed companies,supervision department and market participants: improve the listed companies' stock pledge information disclosure system;strengthen policy guidance raleted to stock pledge;promote internal governance and external supervision mechanism;and cultivate rational market participants.