We examine the effects of corporate lawsuits in China and find that litigation announcements depress the stock prices of both defendant and plaintiff firms. Financially distressed defendants suffer lower stock returns. We find that politically connected defendants are favored in the judicial...

Allen, Qian and Qian (2005, Journal of Financial Economics) explores the role of alternative financing channels (e.g., trade credits and private credit agencies) and governance mechanisms, such as those based on reputation and relationship, in explaining the growth of the private sector in...

Using the theories of the political marketplace and political instability, we examine the effect of political capital on firms' access to bank loans in relation to the political environment. In particular, we use political capital inequality and political instability to characterize the...

The existing literature on political capital and bank lending largely overlooks the role of the political environment. Using the theories of the political marketplace and political instability, we examine the effect of political capital on firms' access to bank loans in relation to the political...