Product Market Competition, Shareholder Governance and Firm Value: The Evidence from China

This paper explores the interaction between product market competition and shareholder governance in transitional economy in China and investigates the influence of ultimate controller of listed companies on this relationship. The research finds that there is a complementary influence between product market competition and shareholder governance when the strength of competition goes beyond certain level. What´s more, this relationship is stronger in companies ultimately controlled by the private than by the state. Finally, we conclude that the relationship between product market competition and shareholder governance is not simply monotonic