Time:November 18, 2010 (Thursday), 10:00-11:30am

Seminar room：216 New Building

Speaker:Dr. REN, Bing (任兵), Nankai University（南开大学）

Title:Corporate Interlock Network And Firm Performance During China's Institutional Transitions

Abstract：

Prior research, mostly on Western economies, suggests that corporate interlock significantly influences firm performance, but says little how their relationship can be complex and dynamic under institutional transitions. Based on the neo-institutionalism perspective and resource dependence theory, we propose that the performance effect brought by ‘being at the central position in the corporate network of interlocks’(hereinafter corporate interlock network centrality) will be largely influenced by the institutional transitions traversing time which are characterized with both formal and informal institutional change either in gradual or critical way. Based on the literature that the interlock effect may vary across firm-level contingencies, we propose that the interlock network effect over gradual and critical institutional transitions will vary across firm size and government ownership change. A longitudinal panel data of Chinese listed companies (1994-2006) is used to test the proposed hypotheses. The results show that where institutions evolve over a critical legal change, the positive effect from firm centrality on performance is weaker for firms who conduct privatization; and is stronger for smaller firms as the economic reform progressed over time.

Keywords: Interlock network centrality; Institutional transitions; Financial

performance, Firm size, Government ownership change