Institutional Cross Shareholdings and the Enterprise Market Power
Based on the highly concentrated equity structure in China's capital market,this paper ex-plores the institutional cross shareholdings and its influence on the enterprise market power.The study reveals that institutional cross shareholdings in China's capital market can significantly enhance a company's market power,supporting the hypothesis of"collusion effects".Heterogeneity tests show that the higher the concentration of equity ownership,the stronger the collusion effects,with industrial capital cross shareholdings exhibiting a stronger collusion effect compared to financial capital.Mechanism tests indicate that companies with institutional cross shareholdings en-gage in upward manipulation of production costs to"rationalize"the increase in product prices.Eco-nomic consequences tests reveal that the collusion effects of institutional cross shareholdings weaken the implementation effectiveness of the Antitrust Law significantly.Based on the crucial fea-ture of high equity concentration in China,this paper unveils the collusion effects of institutional cross shareholdings and clarifies its impact on the enterprise market power,thereby holding impor-tant policy implications for market supervision.
Institutional Major ShareholderCross ShareholdingsCollusion EffectsEnterprise Market PowerAntitrust Law