This paper investigates how political
connection and management promotion affect chances of risk-taking activities,
in order to offer theoretical support for state-owned enterprises to select
optimal managers, and to maintain and increase their company values. Using the
data of chairman of state-owned listed enterprises in Shenzhen securities market,
we find that in state-owned listed enterprises, the shorter the pyramid of
listed enterprises to ultimate shareholders is, the closer the political connection is, the more likely the chairman is to take up
risk-taking activities for promotion. While for the same pyramid, the longer
the tenure of chairman, the more chances of risk-taking activities.
Cite this paper
Zhao, Q. , Wang, S. and Chen, C. (2014) Political Connection, Management Promotion and Risk Taking Activities. Modern Economy
, 774-784. doi: 10.4236/me.2014.57071
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