Government disclosure specificity and stock price synchronicity: Evidence from local government work reports in China

Manning Gong, Chunfang Cao and Yuheng Zhang

Finance Research Letters, 2025, vol. 71, issue C

Abstract: Using machine learning methods to conduct a textual analysis of city government work reports in China, we measure the specificity of government disclosures and examine whether this specificity affects stock pricing efficiency. We find that more specific forward-looking information disclosed by local governments is associated with lower stock price synchronicity among local listed companies. This effect is more pronounced for companies operating in environments with high economic policy uncertainty.

Keywords: Government disclosure; Information specificity; Stock price synchronicity; Stock pricing efficiency (search for similar items in EconPapers)
JEL-codes: G14 G18 M41 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:71:y:2025:i:c:s1544612324014922

DOI: 10.1016/j.frl.2024.106463

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