The China-U.S. trade frictions and COVID-19 pandemic have caused unprecedentedly high economic policy uncertainty since 2017. To resist this high uncertainty, investors may prefer large stocks over small stocks, thereby damaging the size effect. To test this inference, we apply data from China...

This study examines the relationship between litigation risk and stock price crash risk. Using a sample of Chinese A-share listed firms and a comprehensive range of lawsuits filed against their firms covering 2000 to 2020, we find that litigation risk is positively related to stock price crash...