Does Modern Information Technology Attenuate Managerial Information Hoarding? Evidence from the EDGAR Implementation

Xiaoran Ni, Ye Wang, David Yin

Research output: Contribution to journalArticlepeer-review

11 Scopus citations

Abstract

Exploiting the staggered implementation of the EDGAR system from 1993 to 1996 as exogenous shocks to information dissemination technologies, we document that faster dissemination of corporate disclosures through the internet increases firms' future stock price crash risk. These results are robust to alternative sample constructions, measures of crash risk, and fixed effects. Supplemental evidence suggests two channels: an increase in stock liquidity and an increase in investors' reliance on public disclosure, both of which exacerbate managers' incentives to withhold bad news. Overall, our findings suggest that modern information technology may have an unintended effect on managers' bad news hoarding behavior.

Original languageEnglish
Article number102100
JournalJournal of Corporate Finance
Volume71
DOIs
StatePublished - Dec 2021

Keywords

  • EDGAR
  • Information hoarding
  • Modern information technology
  • Stock liquidity
  • Stock price crash risk

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