Abstract The relationship of minority investors protection, government intervention and the capital allocation are discussed in this paper, borrowing the model proposed by Wurgler(2000). We find out that higher investor protection leads to higher allocation of capital, but the effect will be reduced by the government intervention. The findings imply that in order to improve the allocation of capital, the protection to investors should be strengthened and the intervention of government should be restrained.
2014, Vol. 31 
