Social media information dissemination and corporate bad news hoarding

He, Feng; Feng, Yaqian; Feng, Lingbing

doi:10.1111/acfi.12959

Cited by 9 publications

(2 citation statements)

References 60 publications

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“…As a whole, this analysis highlights the complex effects of post-COVID-19 technical developments on different markets, with a range of results from improved predictability to changes in investor behavior and efficient markets. The bulk of market results are consistent with the hypothesis of data overload, which holds that investors would act irrationally even when they have access to all relevant information (He et al, 2023;Jansen et al, 2020;Kirchler et al, 2005;Li et al, 2019;Rasheed, Ali, & Khan, 2023;Shiller, 1995;Yuan, 2022). In addition, the Wald test's results indicate that stock market forecasting exists independent of information availability and technical improvements.…”

Section: Cafrsupporting

confidence: 58%

“…According to the traditional literature, this idea is called into question by the existence of market frictions that prevent investors from acquiring entire information. Despite significant developments in technology to reduce information asymmetry, information overload and hoarding are still a worry among traditionalist (Bernales, Valenzuela, & Zer, 2022;He, Feng, & Feng, 2023;Jansen, Nikiforov, & Lee, 2020). According to an alternative viewpoint, this return predictability or deviation is attributed to shifts in risk variables linked to stock prices and economic risk premiums (Conrad & Kaul, 1988;Fama & French, 1988;Xue & Zhang, 2017).…”

Section: Introductionmentioning

confidence: 99%

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Post-COVID-19 technology adoption and noise trading: elucidation of investors' sentiments across cultures

Tan,

Rasheed,

Rasheed

2024

CAFR

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PurposeDespite its devastating nature, the COVID-19 pandemic has also catalyzed a substantial surge in the adoption and integration of technological tools within economies, exerting a profound influence on the dissemination of information among participants in stock markets. Consequently, this present study delves into the ramifications of post-pandemic dynamics on stock market behavior. It also examines the relationship between investors' sentiments, underlying behavioral drivers and their collective impact on global stock markets.Design/methodology/approachDrawing upon data spanning from 2012 to 2023 and encompassing major world indices classified by Morgan Stanley Capital International’s (MSCI) market and regional taxonomy, this study employs a threshold regression model. This model effectively distinguishes the thresholds within these influential factors. To evaluate the statistical significance of variances across these thresholds, a Wald coefficient analysis was applied.FindingsThe empirical results highlighted the substantive role that investors' sentiments and behavioral determinants play in shaping the predictability of returns on a global scale. However, their influence on developed economies and the continents of America appears comparatively lower compared with the Asia–Pacific markets. Similarly, the regions characterized by a more pronounced influence of behavioral factors seem to reduce their reliance on these factors in the post-pandemic landscape and vice versa. Interestingly, the post COVID-19 technological advancements also appear to exert a lesser impact on developed nations.Originality/valueThis study pioneers the investigation of these contextual dissimilarities, thereby charting new avenues for subsequent research studies. These insights shed valuable light on the contextualized nexus between technology, societal dynamics, behavioral biases and their collective impact on stock markets. Furthermore, the study's revelations offer a unique vantage point for addressing market inefficiencies by pinpointing the pivotal factors driving such behavioral patterns.

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Section: Cafrsupporting

confidence: 58%

Section: Introductionmentioning

confidence: 99%

Post-COVID-19 technology adoption and noise trading: elucidation of investors' sentiments across cultures

Tan,

Rasheed,

Rasheed

2024

CAFR

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Social media attention and corporate greenwashing: Evidence from China

Ren,

Wu,

Hou

2024

Corp Soc Responsibility Env

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This study examines the effect of social media attention on corporate greenwashing using a sample of Chinese A‐share listed firms from 2011 to 2021. We find that social media attention increases corporate greenwashing, and the effect is more pronounced for firms with negative financial performance and those with violations, supporting the pressure hypothesis. Drawing on fraud triangle theory, which considers the interplay of pressure, opportunity, and rationalization, we also find that the pressure effect is more pronounced for firms with higher CEO power, greater information asymmetry, as well as firms located in regions with a gambling culture and non‐state‐owned firms. This indicates that firms are more inclined to greenwash when they perceive an opportunity and can rationalize this behavior. Furthermore, our heterogeneity analyses demonstrate that the pressure effect is more significant for firms located in regions characterized by higher marketization, firms operating in non‐heavily polluting industries, and those that do not provide assured non‐financial reports. This study contributes to the literature on the role of social media and determinants of corporate greenwashing, providing important implications for firms' sustainable development.

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