Short-selling deregulation and corporate social responsibility of tourism industry in China

Abstract

This study aims to examine the impact of short selling constraints on corporate social responsibility (CSR) of listed tourism companies in China. Based on the external governance theory, it is hypothesized that short selling deregulation provides a monitoring function on CSR performance of tourism companies, which are highly exposed to social and environmental problems. A multiple linear regression is conducted with a panel data of Chinese 21 listed tourism firms between 2010 and 2018. The descriptive statistics show that average CSR score of Chinese tourism companies is 25.52/100, which represents low CSR performance of tourism industry. The regression results illustrate that short selling constraints relaxation can improve CSR performance of tourism companies. The findings of this study indicate that financial policymakers shall consider further relaxation of short selling constraints, which can be beneficial to industry, such as tourism, that are sensitive to CSR practices and performance.

The Moderating Effect of Family Business Ownership on the Relationship between Short-Selling Mechanism and Firm Value for Listed Companies in China

“…They indicated that the appearance of short selling plays a deterrent role in corporate policies so that shortable firms engage in fewer earnings management and more productive R&D investments. In addition, Mai and Hamid (2021b) further analyzed the tourism industry and found that short-selling can improve corporate social responsibility. However, Ni and Yin (2020) criticized that companies have weaker short-run and long-run financial performance after the removal of short-sale bans.…”

Relaxation of Short-Selling Constraints and Innovation Investments of Energy Industry in China

“…Suggested by the references in short-selling studies [16], this study excludes ST* businesses, businesses that were formerly shortable but have since become non-shortable, and businesses with missing relevant information. This article winsorises data at the 1% and 99 percent confidence levels in order to minimize the impacts of outliers.…”

“…This paper attempts to examine the effect of short selling deregulation. Following [16], the measurements of deregulation of short selling include three variables, namely, SHORT, TREAT and SHORT*TREAT. SHORT is the variable of short dummy, which is regarded as 1 if the stock is permitted to short during the sample period, and 0 otherwise.…”