Spillover Effects of Capital Markets on Firm Entry and Exit
This paper theoretically analyzes the spillover effects of firm listings on regional industries.The listing of firms conveys information,reduces uncertainty for new entrants,and encourages new ventures to enter the market.Increased market competition accelerates the exit of some existing firms.Using the information of China's industrial and commercial registered enterprises and A-share listed companies,an empirical analysis finds that:the first firm listing in a regional industry increases the number of new registrations and deregistrations within the same industry in the area,and firms with lower innovation intensity are more vulnerable to the negative impact of listings,leading to their exit from the market.The positive impact of the first firm listing is stronger when the stock price contains more information,there are more analysts paying attention,and more research reports,indicating an information transmission mechanism.Additionally,this promotion effect is greater in regions with higher market development levels and better-developed information infrastructure,as well as in industries with higher information transparency.This paper helps to reveal the important role of the capital market in the development and transformation of the industrial sector.
industry dynamicscapital marketspillover effectsindustrial externalitiesinformation channel
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