Pledged Funds Flows Of Controlling Shareholders' Stock Pledge And Stock Price Crash Risk

In recent years,with the rapid development of China's economy,the financing needs of controlling shareholders in listed companies have become increasingly prominent.Therefore,stock pledge is regarded as a new financing channel and deeply favored by controlling shareholders.Under the background of financial deleveraging,the regulatory level has paid more attention to the pledged funds flows of stock pledge and constantly strengthened its information disclosure requirements,aiming to prevent the risk of"transforming the economy from substantial to fictitious".However,the existing research just uses some surface information like the occurrence of stock pledge and the proportion of stock pledge in measuring the controlling shareholders' stock pledge,while few researchers pay due attention to the pledged funds flows,which can directly reflect the behavior characteristics of controlling shareholders.Besides,few researchers notice the impact of controlling shareholders',stock pledge on the capital market.Based on information hiding hypothesis,agency theory and information asymmetry theory,this paper takes the controlling shareholders'new stock pledge data from 2007 to 2017 as samples,and studies the classification of pledged funds flows.This paper firstly analyses the relationship between pledged funds flows of stock pledge and stock price crash risk,followed by the path analysis from the perspective of information asymmetry,and then explores the impact of institutional investors on them.The results show that:(1)negative pledged funds flows will increase stock price crash risk;(2)the degree of information asymmetry plays a complete intermediary role between pledged funds flows and stock price crash risk;(3)the proportion of institutional investors will enhance the positive impact of negative pledged funds flows on stock price crash risk.The contributions of this paper are as follows:(1)this paper analyses the effect and the transmission path of pledged funds flows on stock price crash risk,enriching the research on the formation mechanism of stock price crash risk;(2)this paper studies the classification of pledged funds flows and explores the impact of pledged funds flows on the sources and the channels of negative information,broadening the research on the economic consequences of stock pledge;(3)this paper finds that institutional investors play the role of"crash accelerator",which provides supporting evidence for"negative supervision hypothesis"and expands the research on the governance function of institutional investors.