Public relations expenditure, media tone, and regulatory decisions

Yanling Wu, Gary Gang Tian

Research output: Contribution to journalArticlepeer-review

7 Citations (Scopus)


This paper examines whether and how firms influence regulatory decisions through media capture. Using the unique Chinese regulation setting, we find that higher public relations expenditure reduces a negative pre-IPO media tone and this relationship is weaker when both firms and media outlets face higher legal punishment risks. By linking the incentives for media capture to regulatory decisions, we further find that a less negative media tone is associated with a higher likelihood of IPO approval. In sum, our findings document that firms can capture media tone and, thus, obtain preferred IPO approvals from regulators, which in turn reduces resource allocation efficiency in an emerging market.
Original languageEnglish
Article number101793
Pages (from-to)1-30
Number of pages30
JournalJournal of Corporate Finance
Publication statusPublished - Feb 2021


  • Public relations expenditure
  • Media tone
  • Regulatory decisions
  • IPO approval


Dive into the research topics of 'Public relations expenditure, media tone, and regulatory decisions'. Together they form a unique fingerprint.

Cite this