| In recent years,academic field has provided rich evidence for relationship research from the perspectives of political relations,hometown relations,and alumni relations.But they ignored a key element: China’s interpersonal relationships are not simple "relationship networks",but a "Quan Zi" culture with "differential order pattern"(Fei,1948).Under the "differential order pattern",everyone forms a network with themselves as the center.The inner circle and the outer circle represent different relationships of intimacy and trust,and the rules they follow are also quite different.Resources,technology,and information are shared only by coterie members.Existing studies equate "relationship" with "Quan Zi",confusing the concept of "Quan Zi" with "relationship".In fact,"relationship" is only the surface,"Quan Zi" plays the key role.It can be seen that "Quan Zi" is more representative than "relationships" in Chinese people’s interpersonal communication and has a more obvious impact on economy and finance(Luo et al.,2014).Especially in the rapid development of China’s capital market in the past 30 years,"Quan Zi" and capital have been deeply integrated.Capital in venture capital field is much easier to form a Quan Zi because of the normality of joint investment.In a closed,trusting and loyal environment,the venture capital Quan Zi complements each other’s advantages,shares resources,and jointly responds to capital,information and markets risks,and plays an important role in the emerging-transition economy as an alternative to the formal system,and also plays an important role in the value discovery of the capital market and firm’s value-added.However,at the same time,the venture capital Quan Zi is easy to induce the unfair problem of capital mismatch,which will not only infringe the interests of ordinary investors,hinder the standardized development of emerging markets,but also even affects the long-term stability of the financial market,which is an urgent and important research topic.The phenomenon of "Quan Zi" in the capital market has gradually attracted the attention of many scholars,but there are still many problems with "how to accurately measure Quan Zi culture" and existing research has not given satisfactory answers to the basic questions about the role and related mechanisms of "Quan Zi" in the transition economy,and relevant large-sample empirical studies are even more scarce.At present,China’s economy is undergoing a special transition period,the root of traditional "differential order pattern" and many problems in the transition period are intertwined,making the phenomenon of "Quan Zi" more prominent.Under the background of China’s strong "Quan Zi" culture,this paper selects the venture capital field where the phenomenon of capital Quan Zi is very prominent.On the basis of reviewing and combing relevant literature,and takes Informal System Theory,Repetitive Game Theory and Information Asymmetry Theory as the theoretical basis,this paper constructs a theoretical analysis framework for the impact of venture capital Quan Zi on firm’s value-added.This paper conducts empirical tests and attempts to explore the following questions: First,what are the structural characteristics of the relationship between venture capital institutions in China,whether there is a Quan Zi of "differential order pattern" in the venture capital market or not,and what are the characteristics of venture capital Quan Zi? Second,does the venture capital Quan Zi have a value-added effect on the venture capital institutions,and how it works? Third,what is the value-added effect of venture capital Quan Zi on the invested enterprises? At the IPO stage,how does venture capital Quan Zi add value of the invested enterprise? In the exit stage after listing,how will venture capital Quan Zi affect the mispricing of the invested enterprise’s stock assets? What is the role of venture capital Quan Zi in capital markets,is it positive or negative?The main research contents and relevant conclusions of this paper are as follows:(1)Different from the traditional social relationship network analysis method,this paper selects the joint investment data of Chinese venture capital institutions from 2009 to 2019 from PEdata database,did research on the "venture capital Quan Zi" formed by repeated joint investment relationship screening and certification as the entry point.Referring to Hochberg et al.(2015),this paper defines the venture capital Quan Zi that frequently jointly invest in the same project in the venture capital market within a certain period of time,so as to construct the venture capital Quan Zi proxies.In order to match the data and effectively identify the venture capital Quan Zi,all venture capital institutions,investment events and exit events are identified as their investment groups.After winsorizing data and excluding the missing data samples,a 1413 venture capital institutions samples were obtained,and a total of 120434 observations were used for the construction of Quan Zi proxies,and related indicators such as Quan Zi dummy,the breadth and depth of Quan Zi,and the power of Quan Zi.Then the method of rolling window is used each year to re-identify and obtain dynamic Quan Zi indicators.On the basis of identifying the venture capital Quan Zi,this paper further examines the characteristics of the venture capital Quan Zi,and based on this,studies the impact of the stratification of the venture capital Quan Zi on the value enhancement of venture capital institutions.The results show that China’s venture capital institutions are clearly circled by Quan Zi,showing the homogeneity of "birds of a feather flock together".Venture capital institutions with a high degree of overlap in investment stages and investment industries and closer distances are more likely to form a Quan Zi.There is also heterogeneity of "complementary advantages".Venture capital institutions with different characteristics,investment experience and listing operation capabilities are more likely to form Quan Zi,and it is easier for local and overseas institutions to form a Quan Zi.In addition,the venture capital Quan Zi has a significant value creation effect on venture capital institutions.The power of the venture capital Quan Zi not only increases the investment volume,investment amount,the number of IPO and success rate of venture capital institutions,but also shows obvious circle "step effect",when the low-level venture capital institutions cooperate with high-level partners in the venture capital Quan Zi,the investment efficiency accelerates.In further mechanism analysis,this paper finds that in areas with low marketization,weak property rights protection,low legalization level,and strong government intervention,the economic effects of venture capital Quan Zi are more obvious,reflecting a significant "lubricant" function.When faced with regulatory policy changes,Quan Zi as an alternative to formal system,the more obvious value-added effect of the Quan Zi has in the period of higher economic policy uncertainty.In addition,this paper takes the changes in private fund management policies as an exogenous shock,and the study finds that the venture capital Quan Zi has a positive effect of resisting the negative impact of policy uncertainty,and the venture capital Quan Zi has significantly improved the investment efficiency after the new regulations on private fund management.(2)This paper then studies examines the enterprises’ value-added effect of the venture capital Quan Zi from the perspective of the implicit cost of the invested enterprises in the IPO process.China’s capital market started late,the development is still immature,the overall governance environment is not so good,and the implicit cost has become a "roadblock" for many companies to go public.This aspect is particularly worthy of attention.This paper measures implicit costs from three aspects,IPO underpricing,media fees and time cost.Then,it identifies the information of companies that have the support of venture capital Quan Zi in three years before the company’s listing and exit in the form of an A-share IPO,identifies whether the IPO company has Quan Zi support and the number of Quan Zi,and systematically studies the impact of venture capital Quan Zi on implicit costs.The results show that the venture capital Quan Zi can significantly reduce IPO underpricing,media fees and time costs.Especially in the market environment with low corporate information transparency and poor governance,the venture capital Quan Zi can play a significant role in " certification " in the firm’s IPO process.Furthermore,this paper attempts to explore the quality of IPO companies certified by Quan Zi,and finds that the companies with endorsement of the Quan Zi are less likely to perform worse after listing,which further confirms the "authentication" effect of the venture capital Quan Zi.(3)Finally,this paper studies the influence of venture capital Quan Zi on mispricing of equity assets from the perspective of the deviation between the market value and intrinsic value of invested enterprises.In the IPO process,this paper finds that the venture capital Quan Zi has the " certification " function,which can reduce information asymmetry and reduce the implicit cost.But venture capital institutions are rational-economic man,they chase profits and surely pay attention to stock prices.So,how does the venture capital Quan Zi affect the stock price after a company goes public? Will the power of the venture capital Quan Zi correct the mispricing of stocks,or just boost stock prices for profit? This paper studies the impact of venture capital Quan Zi on stock mispricing after a company goes public,and examines the impact of venture capital Quan Zi on corporate value addiction from the perspective of the deviation between a company’s market value and intrinsic value.The results show that the venture capital Quan Zi has an asymmetric impact on the stock price.The stronger the venture capital Quan Zi is,the more obvious the overvaluation of the stock price is,but it does not significantly affect the degree of undervaluation.This effect is related to the exit time of venture capital.In the lock-up year and the following year,the venture capital Quan Zi significantly affects asset mispricing,boost the expansion of enterprise market value and then the effect gradually weakens.Further research finds that the venture capital Quan Zi pushed up stock prices through internal channels of earnings manipulation,while also raising stock prices through market channels such as the increase of institutional investor holdings,positive media coverage,and stock liquidity.This paper confirms that the venture capital Quan Zi has the function of asset price discovery,and also reveals the opportunistic characteristics of the venture capital Quan Zi,which pushes up the stock price through unreasonable means,which induces the problem of capital mismatch.The innovations and contributions of this paper are mainly reflected in the following four aspects:First,this paper is quite innovative in its research perspective."Culture and finance" is a new research topic that has emerged in recent years,and how culture affects economic and financial behavior has become a hot topic in academic research,which is highly concerned by scholars.However,based on the research of " Quan Zi culture" in China,there is still a large room for breakthrough." Quan Zi " is more representative of Chinese interpersonal interactions than "relationships",and their impact on economics and finance is more obvious.This is especially true in the capital market,where the deep integration of capital and Quan Zi is an indisputable fact.The role of " Quan Zi culture" in the capital market has gradually attracted the attention of many scholars,but for the basic questions,such as how to quantitatively measure " Quan Zi culture" and the mechanism of " Quan Zi " in the transition economy,existing research has not yet given satisfactory answers,and related large sample studies are even more scarce.This paper selects the venture capital investment field where the phenomenon of Quan Zi is very prominent as a natural experimental place,tries to find out answers to the above problems,and provides a theoretical basis for the value-added effect of venture capital Quan Zi to the value of venture capital institutions and invested enterprises.Secondly,the research method of this paper is innovative,which provides inspiration for quantitatively measure " Quan Zi culture" and expands the research framework of the relationship network.Academia often studies the power of capital based on the relationship between individuals,such as the relationship network formed by alumni,fellow villagers,and colleagues.These relationship networks originate from individuals,cannot be determined to form a community of interests,and it is very likely to fall into the illusion of "there are relationships,but no Quan Zi".Based on the joint investment data of venture capital,this paper organizes the data manually,identifies the investment institutions and investment events,so as to construct the indicator of the venture capital Quan Zi.This paper dilutes the intricate interpersonal network relationships behind the Quan Zi,focuses on joint investment relationship,reveals the reality of capital linkage in China’s venture capital market.Thirdly,this paper has innovations in the research contents.A large number of previous literatures have confirmed the value-added effect of venture capital,and fruitful research results have been achieved in company supervision and management,investment and financing efficiency,production efficiency,joint investment,market value and other aspects.Based on the role of Quan Zi in the capital market,this paper examines the value-added effect of Quan Zi,not only from the dimension of the invested enterprise,but also from the dimension of the venture capital institution itself.this paper also constructs a model of "the value added of the venture capital institution itself-the value added of the invested enterprise at the IPO stage-the value added of the invested enterprise after listing".In the process of studying the value-added effect of invested enterprises,we start from two different stages: at the IPO stage,the implicit cost is measured by the financial public relations fee,the mispricing cost and the time cost,the value-added effect of the Quan Zi is explored from the perspective of opportunity cost;after the enterprise is listed,this paper examines how Quan Zi influence stock mispricing from internal channels and market channels.This paper deeply analyzes the interest motivation behind the Quan Zi,and is also a useful supplement to the literature related to the implicit cost and the causes of asset mispricing.Fourthly,as for the research significance,this paper,by using joint venture capital investment field as a natural experiment site,identify the existence of Chinese venture capital market "Quan Zi" phenomenon and the formative characteristics of " Quan Zi",and the specification of the theoretical analysis and empirical research combed the "network culture" the impact on the enterprise value creation and its role in capital market.On one hand,the conclusions are helpful for regulators to recognize and pay attention to the market boundary of capital force,and it has important guiding significance for how to identify "Quan Zi" in various scenarios,gather forces for rational and effective use,especially to strengthen dynamic supervision and guide the orderly competition of capital force.On the other hand,this paper has reference value for investment institutions on how to choose long-term cooperative syndication partners,how to deal with uncertain events and how to improve their organization value.In addition,it is helpful to analyze the value creation of enterprises from the perspective of culture,inject internal impetus into the development of Chinese enterprises,and has important significance to reexamine the profound impact of Chinese traditional culture on economy and finance. |
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