China & World Economy / 79–100, Vol. 21, No. 4, 2013
Effects of Social Capital, Top Executive Attributes and R&D on Firm Value in Chinese Small and Medium-sized Enterprises
Penghua Qiao, Hung-Gay Fung, Xiaofeng Ju*
Abstract
This study uses an unbalanced panel data analysis to examine the effects of social capital, top executive attributes and R&D on firm value in Chinese small and medium-sized enterprises (SMEs) listed on the Shenzhen Stock Exchange Small and Medium-sized Enterprises Board from 2007 to 2011. There are several interesting findings. First, the gender (male) and academic degree of the chairperson in the SMEs have a positive and significant effect on firm value. Second, social capital (measured by political connections, managerial business association networks and technology association networks) and R&D have a positive effect on SME firm value. Third, the effect of political connections on firm value for state-owned enterprises (SOEs) is stronger than for non-SOEs, while the effect of business and technology networks on firm value for non-SOEs is stronger than for SOEs. Our study has important policy implications for SMEs that want to compete successfully in China.
Key words: firm value, R&D, small and medium-sized enterprises, social capital, top executive attributes
JEL codes: G28, G31, G32