Investor Protection and Post-Disclosure Disagreement: International Evidence

IF 2 Q2 BUSINESS, FINANCE International Journal of Accounting Pub Date : 2022-07-06 DOI:10.1142/s1094406022500123
Tao Chen
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Abstract

Synopsis The research problem Adding to the literature on investor protection, this study investigates whether nationwide institutional features may explain cross-country variation in post-disclosure disagreement. Motivation Previous research has revealed that the release of financial statements aggravates investor disagreement rather than attenuating it. However, most studies only obtain empirical evidence in the context of the United States; no work has examined this research question in an international setting. Another motivation for this paper is the attempt to understand the contradiction in the literature, which emphasizes micro-level determinants. By contrast, minimal attention has been paid to the macro-level institutional factors of a country’s information environment, which presumably prompts investors to shape heterogeneous beliefs. The test hypotheses H1: Countries with greater corporate transparency are associated with a lower level of post-disclosure investor disagreement. H2: Countries with stronger legal protection are associated with a lower level of post-disclosure investor disagreement. Target population Various stakeholders include firm managers, financial analysts, regulatory watchdogs, and users of earnings reports. Adopted methodology Ordinary Least Squares (OLS) Regressions Analyses Gao et al. ( 2012 ) to measure investor disagreement while we quantify corporate transparency (legal protection) by extracting the first principal component of nine countrywide characteristics pertinent to disclosure requirements (legal systems). Using a global sample from 38 countries, we perform a cross-sectional regression of post-disclosure disagreement on two proxies for investor protection after accounting for firm-specific control variables. Findings We find clear evidence of post-disclosure disagreement in all countries. Next, we document a negative relationship between corporate transparency (legal protection) and post-disclosure disagreement. Additional tests confirm that both better disclosures and strong regulations enhance information precision, accelerate information dissemination, and reduce informed trading, thus leading to a lower level of post-disclosure disagreement.
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投资者保护与信息披露后的分歧:国际证据
除了投资者保护方面的文献外,本研究还探讨了全国性的制度特征是否可以解释披露后分歧的跨国差异。先前的研究表明,财务报表的发布加剧了投资者的分歧,而不是减轻了分歧。然而,大多数研究只在美国的背景下获得经验证据;没有工作在国际环境中检查这个研究问题。本文的另一个动机是试图理解文献中的矛盾,强调微观层面的决定因素。相比之下,很少有人关注一个国家信息环境的宏观层面的制度因素,这可能会促使投资者形成异质的信念。检验假设H1:公司透明度越高的国家,披露后投资者的分歧水平越低。H2:法律保护较强的国家披露后投资者的分歧程度较低。不同的利益相关者包括公司经理、金融分析师、监管机构和收益报告的使用者。Gao等人(2012)通过提取与披露要求(法律制度)相关的九个全国性特征的第一个主成分来量化公司透明度(法律保护),并采用普通最小二乘(OLS)回归分析方法来衡量投资者的分歧。使用来自38个国家的全球样本,我们在考虑了公司特定控制变量后,对投资者保护的两个代理进行了披露后分歧的横断面回归。我们在所有国家都发现了信息披露后分歧的明显证据。接下来,我们记录了公司透明度(法律保护)与披露后分歧之间的负相关关系。其他测试证实,更好的披露和强有力的监管都能提高信息准确性,加速信息传播,减少知情交易,从而降低披露后的分歧程度。
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来源期刊
CiteScore
1.20
自引率
0.00%
发文量
19
期刊介绍: The aim of The International Journal of Accounting is to advance the academic and professional understanding of accounting theory, policies and practice from the international perspective and viewpoint. The Journal editorial recognizes that international accounting is influenced by a variety of forces, e.g., governmental, political and economic. Thus, the primary criterion for manuscript evaluation is the incremental contribution to international accounting literature and the forces that impact the field. The Journal aims at understanding the present and potential ability of accounting to aid in analyzing and interpreting international economic transactions and the economic consequences of such reporting. These transactions may be within a profit or non-profit environment. The Journal encourages a broad view of the origins and development of accounting with an emphasis on its functions in an increasingly interdependent global economy. The Journal also welcomes manuscripts that help explain current international accounting practices, with related theoretical justifications, and identify criticisms of current policies and practice. Other than occasional commissioned papers or special issues, all the manuscripts published in the Journal are selected by the editors after the normal double-blind refereeing process.
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