Corporate Accessibility and Stock Price Crash Risk

Research output: Other Conference ContributionsConference Paper (other)Other Conference Paper

Abstract

We examine whether accessibility to outside market participants can mitigate stock price crash risks in a weak public information environment. We measure accessibility on the basis of outside investors’ attempts to communicate with listed firms via public communication channels (e.g., telephones, e-mail, and online forums) in China. We find that accessible firms face lower crash risks than inaccessible firms, and the effect increases with public disclosure opacity. Accessible firms have more private meetings with outside investors and the effect of accessibility increases when the meetings contents are disclosed. Finally, accessible firms accumulate less negative corporate information than inaccessible firms.
Original languageEnglish
Publication statusPublished - 16 Aug 2019
Event2019 Greater Bay Area Summer Finance Conference - Hong Kong University of Science and Technology, Hong Kong, Hong Kong
Duration: 15 Aug 201916 Aug 2019
http://w3.bm.ust.hk/fina/gba/index.html

Conference

Conference2019 Greater Bay Area Summer Finance Conference
CountryHong Kong
CityHong Kong
Period15/08/1916/08/19
Internet address

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Bibliographical note

This manuscript is dedicated to Michael Firth, who passed away in August 2016. While working on revisions to this manuscript, he enlightened us with his wisdom about life and his brilliant understanding of financial and accounting
economics, which was important for the eventual completion of this work.

We are grateful to Ferdinand Gul, K. Philip Wang, Baohui Zhang, Chen Lin, Dan Li, Guanming He, Li Guo, and seminar participants at FMA (European), FMA (Annual), CICF, Shanghai JiaoTong University, and Chinese University of Hong Kong, for their comments. Wong thanks the Government of the Hong Kong Special
Administrative Region of PRC for funding support (GRF LU391113).

Keywords

  • Corporate Accessibility
  • Private information acquisition
  • Stock price crash risk
  • China

Cite this

FIRTH, M., WONG, S. M., & ZHAO, X. (2019). Corporate Accessibility and Stock Price Crash Risk. Paper presented at 2019 Greater Bay Area Summer Finance Conference, Hong Kong, Hong Kong. http://w3.bm.ust.hk/fina/gba/Program/SessionV/Firth,%20Wong,%20and%20Zhao%20(2019).pdf