Corporate governance and the divergence of learning channels

Ming Yan William Cheung, Adrian Lei, Libin Tao

研究成果: Article

抄録

We study the relation between corporate governance, market liquidity and stock price informativeness. Firms with more informative stock prices are associated with larger transaction volume, larger bid-ask spread and better corporate governance. Thisliquidity-informativeness relation is significant for firms with high antitakeover provision (bad corporate governance). However, bid-ask spread is insignificantly associated withprice informativeness for firms with less antitakeover provision (good corporate governance). This supports that firm-specific return variation better measures stock price informativeness when firm has strong corporate governance framework. Our results suggest that (i) more (less) informed trading activities associated with weak (strong) corporate governance, and (ii) corporate governance explains the cross-sectional variation in information efficiency of stock prices. Our results are consistent with theories in financial market learning that investor learn from informed trading activities associated with weak governance firms and informative disclosure from strong governance firms.

元の言語English
ページ(範囲)9-15
ページ数7
ジャーナルCorporate Ownership and Control
8
発行部数3 A
出版物ステータスPublished - 2011
外部発表Yes

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Divergence
Corporate governance
Stock prices
Price informativeness
Trading activity
Antitakeover provisions
Informed trading
Bid/ask spread
Governance
Informativeness
Financial markets
Disclosure
Market liquidity
Information efficiency
Investors

ASJC Scopus subject areas

  • Business, Management and Accounting(all)

これを引用

Corporate governance and the divergence of learning channels. / Cheung, Ming Yan William; Lei, Adrian; Tao, Libin.

:: Corporate Ownership and Control, 巻 8, 番号 3 A, 2011, p. 9-15.

研究成果: Article

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