Geographical proximity, cultural familiarity and financial information production

Han Hao, Chun Liu and Shunzhi Pang

Journal of Empirical Finance, 2025, vol. 80, issue C

Abstract: This paper examines the distinct impacts of geography and culture on financial information production. Utilizing data from LinkedIn, we categorize Chinese-concept stock analysts into two groups: those working in China and those with a Chinese cultural background. We identify two sources of local advantages: geographical proximity, stemming from the information-access channel, and cultural familiarity, originating from the information-process channel. Additionally, our findings indicate that local advantages reduce stock return synchronicity, and investors can recognize revisions made by geographically proximate analysts.

Keywords: Local advantage; Geographical proximity; Cultural familiarity; Analyst forecast accuracy (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:empfin:v:80:y:2025:i:c:s0927539824001105

DOI: 10.1016/j.jempfin.2024.101576

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