Data

Social-Proximity-to-Capital (SPC) data: Download Here

If you use this data, please cite the following paper, which develops the SPC measure:

Theresa Kuchler, Yan Li, Lin Peng, Johannes Stroebel, Dexin Zhou, Social Proximity to Capital: Implications for Investors and Firms, The Review of Financial Studies, Volume 35, Issue 6, June 2022, Pages 2743–2789, https://doi.org/10.1093/rfs/hhab111. 

Published version, working paper version

Abstract: We show that institutional investors are more likely to invest in firms from regions to which they have stronger social ties but find no evidence that these investments earn a differential return. Firms in regions with stronger social ties to locations with many institutional investors have higher valuations and liquidity. These effects are largest for small firms with little analyst coverage, suggesting that the investors’ behavior is explained by their increased awareness of firms in socially proximate locations. Our results highlight that the social structure of regions affects firms’ access to capital and contributes to geographic differences in economic outcomes.