Related Party Transactions and Stock Price Crash Risk: Evidence from India

Ekta Selarka () and Subhra Choudhury
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Ekta Selarka: Madras School of Economics
Subhra Choudhury: Madras School of Economics

Chapter Chapter 9 in Indian Business Groups and Other Corporations, 2023, pp 233-253 from Springer

Abstract: Abstract Related Party Transactions disclosures in Annual Reports have recently gained more attention of the Indian policymakers. This paper aims at finding out the effect of related party transactions disclosure on the stock price crash risk faced by the firms. Using a large sample of all the NSE listed firms for the period 2005–2012 this study provides evidence that related party disclosure is associated with a decrease in the stock price crash risk faced by the firms. This finding is consistent with the view that information asymmetry increases crash risk. In addition to this, the study finds that such decrease is observed more in the firms with higher risk.

Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:isbchp:978-981-99-5041-6_9

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DOI: 10.1007/978-981-99-5041-6_9

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