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Reap what you sow: Corporate political activities and the external governance environment

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  • He, Xuan
  • Xiao, Weicheng

Abstract

This study analyzes the impact of the corporate political activities (CPAs) of large listed enterprises on the external governance environment (EGE) in emerging markets. This article argues that in the context of China, the entry of listed private manufacturing enterprises into the real estate industry, which depends heavily on land allocated by local governments, increases governmental interference in the economy and weakens the EGE. In particular, when firms utilize political connections, the negative effect is exacerbated, whereas a stronger innovation focus mitigates this impact. A multimodel empirical analysis of panel data from 2003 to 2019 confirms our hypotheses.

Suggested Citation

  • He, Xuan & Xiao, Weicheng, 2026. "Reap what you sow: Corporate political activities and the external governance environment," Emerging Markets Review, Elsevier, vol. 71(C).
    • Handle: RePEc:eee:ememar:v:71:y:2026:i:c:s1566014125001840
    DOI: 10.1016/j.ememar.2025.101435
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