Author(s)

Dehong Wang^*, Yue Wu

International Business School, Beijing Foreign Studies University, Beijing, China.

This paper analyzes the relation between state-owned capital factor and earnings quality through Earnings Response Coefficient (ERC) in Chinese stock markets. Our research finds that the ERC is significantly associated with the role state-owned capital plays in the equity structure of the companies in Chinese stock markets. Further analysis indicates that companies controlled by state-owned capital tend to have a better earnings quality.

State-Owned Capital, ERC, Equity Structure, Earnings Quality

Wang, D. and Wu, Y. (2016) Does State-Owned Capital Manipulate Earnings Responses in China?. Journal of Mathematical Finance, 6, 685-698. doi: 10.4236/jmf.2016.65048.