Transparency and stock price informativeness: evidence from a natural experiment in China

Huili Zhang, Rong Li and Zhengfei Lu

Applied Economics Letters, 2023, vol. 30, issue 2, 114-119

Abstract: We study the impact of transparency on stock price informativeness by using an exogenous change in China: the comply-or-explain dividend regulation. Employing a difference-in-difference (DID) design, we find that increased transparency arising from firm’s detailed disclosures regarding their use of funds significantly enhances their stock price informativeness. This effect is stronger for firms with higher information asymmetry and for firms with more-detailed explanations. Additionally, the cumulative abnormal return within a short window is positively related to the level of detail in the explanations.

Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/13504851.2021.1977231 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:apeclt:v:30:y:2023:i:2:p:114-119

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEL20

DOI: 10.1080/13504851.2021.1977231

Access Statistics for this article

Applied Economics Letters is currently edited by Anita Phillips

More articles in Applied Economics Letters from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().