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Short selling and SME irregular CEO succession: Witnessing the moderating role of earnings management

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  • Sha, Yezhou
  • Shah, Syed Ghulam Meran
  • Sarfraz, Muddassar

Abstract

The objective of the study is to contemplate the impact of irregular CEO succession on small-medium enterprises' short selling. Using the sample containing 933 Chinese listed SMEs in 2015–2019, we have formulated irregular CEO succession. Further, irregular CEO succession has been categorized into three types while contemplating the SMEs' profile. Conclusively, the empirical underpinnings substantiate the absolute effectiveness of irregular CEO successor on short selling. Similarly, the three categorizations of irregular CEO succession have augmented the short-selling targeting on SMEs. Explicitly, earning management's moderating role has been demonstrated to be a blessing in disguise for deterring the short sale. Additionally, CEO attributes such as age and education have negatively correlated with short selling. Our findings contribute to deepen the understanding of psychological aspects of the top management team of Chinese SMEs.

Suggested Citation

  • Sha, Yezhou & Shah, Syed Ghulam Meran & Sarfraz, Muddassar, 2023. "Short selling and SME irregular CEO succession: Witnessing the moderating role of earnings management," International Review of Economics & Finance, Elsevier, vol. 85(C), pages 163-173.
    • Handle: RePEc:eee:reveco:v:85:y:2023:i:c:p:163-173
    DOI: 10.1016/j.iref.2023.01.017
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    1. Fang, Ming & Chang, Chiu-Lan & Zhang, Qi, 2023. "Impacts of trading restrictions on price volatilities and speculative activities: Evidence from CSI 300 futures," Economic Analysis and Policy, Elsevier, vol. 79(C), pages 184-204.

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    More about this item

    Keywords

    Corporate governance; Irregular CEO succession; SMEs; Earning management; Decision making;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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