Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/338537 
Year of Publication: 
2024
Citation: 
[Journal:] China Journal of Accounting Studies (CJAS) [ISSN:] 2169-7221 [Volume:] 12 [Issue:] 3 [Year:] 2024 [Pages:] 481-524
Publisher: 
Taylor & Francis, Abingdon
Abstract: 
The ownership structure of listed companies affects the risk of stock price crash. Under the background of agency conflict and decentralised equity era of listed companies in China, how to effectively reduce the risk of stock price crash is an urgent problem to be solved. The limited partnership agreement structure has the advantages of risk isolation and equity incentive, therefore, in recent years, more and more enterprises in China's capital market have begun to incorporate the limited partnership agreement into the company's equity structure. Using a sample of companies listed on Shanghai and Shenzhen A-shares from 2014 to 2021, this study empirically examines how the limited partnership agreement structure (LP Structure) affects the stock price crash risk of listed companies. The results show that the limited partnership agreement structure can significantly reduce the risk of future stock price crash, and the research results are still robust after a series of robustness tests and control of endogenous problems. The mechanism test shows that the LP agreement structure can reduce the risk of stock price crash of listed companies by restraining the tunnelling behaviour of actual controllers, strengthening the supervision effect of minority shareholders, realising effective incentives for employees and improving the information transparency of listed companies. In addition, the heterogeneity analysis shows that the LP agreement structure has a more significant impact on the stock price plunge risk of listed companies under the conditions of dispersed ownership and good legal environment. The research in this study provides an incremental literature contribution to further understanding the economic consequences of LP agreement structure, and also provides empirical evidence for more listed companies to adopt LP agreement structure as a flexible architecture.
Subjects: 
employee stock ownership
information asymmetry
Limited partnership agreement structure
principal-agent problem
stock price crash risk
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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