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Weekly Economics Webinar by Chang Ma

September 24 @ 1:30 pm - 2:40 pm

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Event Details

Title: The Effect of the China Connect [link to paper]

Speaker: Chang Ma, Associate Professor of Finance, Fudan University

Abstract: The Shanghai (Shenzhen)-Hong Kong Stock Connect promoted cross-border equity investment under relatively unique circumstances: it was implemented under unchanged tight national capital controls policy; it does not include all mainland stocks; the Chinese economy has massive savings and is replete with capital investment; and China’s domestic credit market is distorted by political connections. We document costs and benefits of the Connect, focusing on firms’ equity price and investment changes. The liberalization brought connected firms lower funding costs and more investment but also increased sensitivity to foreign shocks. The effects on investment work through a cost of funding channel in which ownership structure—state versus private—plays an important role.


September 24
1:30 pm - 2:40 pm


Department of Economics


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