Corporate governance and the divergence of learning channels

William Cheung*, Adrian Lei, Libin Tao

*この研究の対応する著者

研究成果: Article査読

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.

本文言語English
ページ(範囲)9-15
ページ数7
ジャーナルCorporate Ownership and Control
8
3 A
DOI
出版ステータスPublished - 2011
外部発表はい

ASJC Scopus subject areas

  • ビジネス、管理および会計(全般)

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