Paragon or pariah? The consequences of being conspicuously rich in China's new economy

Michael FIRTH, Xianjie HE, Oliver M. RUI, Tusheng XIAO

Research output: Journal PublicationsJournal Article (refereed)peer-review

16 Citations (Scopus)


In some cultures vast personal wealth is lauded whereas in others, it is viewed with suspicion and contempt. In recent years, a super rich elite of business people has emerged in China, and, given the country's cultural and socialist past, we believe that people are more likely to react negatively to reports of conspicuous wealth. To test our arguments, we examine the reactions to and consequences of China's entrepreneurs being included on the Hurun Rich List. We find negative consequences for stock market traded firms controlled by the Rich List entrepreneurs: stock prices decline, government subsidies are reduced, and the named entrepreneurs are more likely to be investigated. These effects are strongest in rent-seeking industries and are mitigated by philanthropy.
Original languageEnglish
Pages (from-to)430-448
Number of pages19
JournalJournal of Corporate Finance
Early online date28 Sept 2014
Publication statusPublished - Dec 2014


  • Conspicuous wealth
  • Fairness
  • Market reaction
  • Government reaction
  • Philanthropy

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