ABSTRACT
The determinants of stock price crash risk remain unclear, especially in transitional economies. Using firm-level data of listed firms in China from 2003 to 2016, we investigate the association between religion and stock price crash risk, as well as the moderating effects of government intervention in Chinese context. Our empirical results show that religious atmosphere in a region alleviates the local firm managerʻs incentive to hide bad news, and thereby potentially reduces stock price crash risk in Chinese context. We also find that the above effect is less pronounced in regions with high government intervention.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Data sharing
The data can be available on request.
Notes
2 ST (special treatment) refers to firms with negative net profit within the two most recent years. PT (particular transfer) refers to firms with negative net profit within the three most recent years.