Download or read book The Impacts of Product Market Competition on the Quantity and Quality of Voluntary Disclosures written by Li, Xi and published by . This book was released on 2016 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study examines how firms' voluntary disclosure decisions are influenced by product market competition. Using separate measures to capture different dimensions of competition, I show that competition from potential entrants increases disclosure quantity while competition from existing rivals decreases disclosure quantity. I also find that competition enhances disclosure quality mainly through reducing the optimism in profit forecasts and reducing the pessimism in investment forecasts. Moreover, I find that the above association is less pronounced for industry leaders, consistent with industry leaders facing less competitive pressures than industry followers.

Download or read book The Effect of Product Market Competition on Corporate Voluntary Disclosure Decisions written by Yong-Chul Shin and published by . This book was released on 2000 with total page 196 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Voluntary Disclosure and the Role of Product Market Competition written by Narayanaswamy Ramaswami and published by . This book was released on 2001 with total page 338 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Effect of Product Market Competition on Mandatory Disclosure Strategy written by Hanyong Chung and published by . This book was released on 2020 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study examines how product market competition affects firms' mandatory disclosure strategies. Using the information in the SEC comment letters, I observe that firms in a highly competitive market are more likely to file unaudited mandatory disclosures with deficiency. I also find that firms facing higher competition from potential entrants tend to bundle positive (negative) mandatory items with the negative (positive) management earnings forecasts. These findings support my conjecture that firms exercise discretion in the mandatory disclosure through less transparent ways, due to a proprietary cost resulting from market competition. Additional analyses demonstrate a positive economic consequence of such disclosure strategy, and the relationship between market competition and mandatory disclosure strategies is stronger for industry followers than for industry leaders.

Download or read book Information Disclosure Product Market Competition and Firm Value written by Kung-Cheng Ho and published by . This book was released on 2016 with total page 57 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study examines the relationship between information disclosures and firm value under different levels of product market competition. Using a unique information rating scheme that draws from 114 measures over five dimensions of information disclosure from 2005 to 2013, we find that firms with higher levels of information disclosure (better information transparency) are related to higher industry-adjusted Tobin's Q. We also find that the levels of information disclosure and product market competition interact in affecting firm value. This relationship is robust after controlling for a number of firm-specific factors and agency-based measures. Our paper brings two streams of research that aim to explain the variation in firms' value together, and suggests that information disclosure and product market competition complement each other in enhancing a firm's value.

Download or read book Issues in Accounting Administration and Corporate Governance 2011 Edition written by and published by ScholarlyEditions. This book was released on 2012-01-09 with total page 317 pages. Available in PDF, EPUB and Kindle. Book excerpt: Issues in Accounting, Administration, and Corporate Governance: 2011 Edition is a ScholarlyEditions™ eBook that delivers timely, authoritative, and comprehensive information about Accounting, Administration, and Corporate Governance. The editors have built Issues in Accounting, Administration, and Corporate Governance: 2011 Edition on the vast information databases of ScholarlyNews.™ You can expect the information about Accounting, Administration, and Corporate Governance in this eBook to be deeper than what you can access anywhere else, as well as consistently reliable, authoritative, informed, and relevant. The content of Issues in Accounting, Administration, and Corporate Governance: 2011 Edition has been produced by the world’s leading scientists, engineers, analysts, research institutions, and companies. All of the content is from peer-reviewed sources, and all of it is written, assembled, and edited by the editors at ScholarlyEditions™ and available exclusively from us. You now have a source you can cite with authority, confidence, and credibility. More information is available at http://www.ScholarlyEditions.com/.

Download or read book The Evolution of Corporate Disclosure written by Alessandro Ghio and published by Springer Nature. This book was released on 2020-04-02 with total page 183 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides a critical analysis of the evolution of corporate disclosure. Building upon prior academic literature, it assesses the most important changes in mandatory corporate disclosure, the growing relevance of social and environmental disclosure, and revolutionary new forms of corporate communication, in particular social media. It also includes empirical analyses that shed further light on the impact of voluntary communication, i.e. social and environmental reporting and corporate social media communication, on managerial and investment decisions. Lastly, it discusses new directions for accounting and corporate governance research on the theoretical and empirical challenges of corporate disclosure. Offering a wealth of relevant and timely advice, the book will help regulators design policies that allow businesses to overcome current and emerging economic, social, and technological challenges.

Download or read book Competition and Voluntary Disclosure of Quality Information written by Zhe Jin and published by . This book was released on 2000 with total page 404 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Quality Disclosure and Comparative Advertisement written by Yeolyong Sung and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: We study firms' voluntary disclosure in an oligopoly market for vertically differentiated products, where firms are allowed to advertise a rival's product as well as their own products. When consumers are uncertain of product qualities, Board (2009)1) and Hotz and Xiao (2011)2) show that price competition among firms alleviates firms' incentives to disclose the quality of their own product. Nonetheless, firms still have incentives to distinguish their own products from those of the competitors to attract more consumers. A comparative advertisement is a useful way to distinguish products and thus, a rival's advertisement can lead to a disclosure of a firm's product information. Comparative or negative advertisements are used in many industries and political campaigns. In 2010, for example in the United States, Verizon Wireless compared their service coverage with that of the competitor, AT&T, on the TV commercial and their Web site in order to advertise the 3G network service for mobile phones (See Figure 1). They had a broader service area than AT&T did and used a comparative advertisement to show that their service was superior.3) Through the negative advertisement by Verizon Wireless on the AT&T's service, the information on the AT&T's mobile phone service was revealed even though AT&T did not disclose their nation-wide service coverage in a picture. This is in contrast with the fact that AT&T themselves put the map showing their nation-wide 3G service coverage for iPads on their Web site.4) At that time AT&T was the only service provider for iPads. This paper allows firms to advertise a rival's product. We show that the qualities of all the products in an industry are fully revealed by a high quality firm's comparative advertisement and full revelation is the unique equilibrium outcome. Each firm's advertisement (message) can convey information on either its own product quality or a rival's or both. Differentiating from traditional models that consider advertisement as a signal of product qualities (Nelson, 19745); Schmalensee, 19786); Grossman and Shapiro, 19847); Kihlstrom and Riordan, 19848)), we consider it as a truthful claim about its qualities. In other words, we see the role of advertisement as conveying factual information directly to the consumers. The restriction of firms' messages to truthful claims can be justified by the argument that an untruthful claim, such as an overstatement on their own product or an understatement on their rival's product, could be challenged in a court of law. If the claim was found to be untruthful, the firm that sent the untrue message might have to pay a fine or more, and the true quality would be revealed as the result. In this model, full revelation occurs as the unique equilibrium outcome. If firms do not disclose any information and consumers do not distinguish the qualities among products, then the firms' profits are zero by price competition. By revealing some information and having consumers perceive that the product is differentiated from its rivals', a firm can increase the profit. In the competition between two firms, there exists an equilibrium in which full information on all products is revealed by the firm with a higher quality (henceforth, called a high quality firm) as in the above example of the mobile phone service industry. The high quality firm can increase the profit by advertising the rival's low quality product as negatively as possible because such an advertisement increases its demand by making more consumers switch from the low quality product to the high quality product. Since false claims are not allowed, the negative advertisements reveal the true quality of the rival's product. Meanwhile, the high quality firm reveals the true quality of its own product building grounds for a higher price. Since an advertisement that fully reveals both firms' product qualities is a dominant strategy for the high quality firm, full revelation is the unique outcome. In general, full revelation fails without advertisement on a rival's product. Such revelation, as many studies suggest, increases consumers' welfare, and thus the literature argues in favor of the introduction of mandatory disclosure laws (Fishman and Hagerty, 20039); Board, 2009; Hotz and Xiao, 2011). However, mandatory disclosure laws burden both private and public sectors with an enforcement cost and a deadweight loss. As an alternative to the costly legal solution, the results of this paper suggest that a market can lead to a full revelation with voluntary disclosure if negative advertisement on rivals' products is allowed. As a parallel example, in the domain of politics, negative advertisement exists in the form of negative campaigning. Amid ongoing debate and controversy, recent studies such as Polborn and Yi (2006)10) defend prevailing negative campaigning arguing that consequently revealed information on the candidates empowers the electorate to make more-informed decisions. The rest of the paper is organized as follows. After reviewing the related literature in Section 2, we present an oligopoly model with price competition between two firms in Section 3 and derive the firms' profit functions from the equilibrium pricing rules and the associated demand functions in Section 4. With the profit functions, in Section 5, we analyze the firms' advertisement strategies and show that there exists an equilibrium in which full information is revealed by the high quality firm. Section 6 concludes the findings and discusses extendible issues.

Download or read book Voluntary Disclosure and Corporate Innovation written by Sheng-Syan Chen and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine whether a firm's voluntary disclosures, proxied by management earnings forecasts, affect its innovation activity. A firm making more disclosures generates fewer patents and lower-quantity patents. Enactment of SOX is applied as a natural experiment for an exogenous shock to voluntary disclosure. Corporate innovation is reduced for accelerated filers, especially after SOX becomes effective. Nondedicated institutional ownership, R&D spillover, and rival firms' innovation are higher for accelerated filers after SOX. There is more of a negative effect of voluntary disclosure on innovation activity when product markets are highly competitive, industry information diffusion is speedy, and disclosures are more informative.

Download or read book Competition Culture and Corporate Finance written by Terry Harris and published by Springer Nature. This book was released on 2023-04-24 with total page 260 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book introduces a measure of firms’ competition culture based on a textual analysis and natural language processing (NPL) of firms’ 10-K filings. Using this measure, the book explores the relationship between competition culture and various phenomena in corporate finance, specifically, institutional ownership structure, stock return performance, idiosyncratic stock price crash risk, meeting/beating analysts’ earnings expectations, and earnings management activity, for a large sample of US-based financial and non-financial firms. In particular, the book provides evidence that transient institutional ownership intensifies firms’ competition culture, while dedicated institutional ownership lessens it. In addition, the book’s findings suggest that firms with greater levels of competition culture achieve higher levels of short-term stock return performance, experience greater incidence of idiosyncratic stock price crashes, and are more prone to meet/beat analysts forecast and engage in accruals-based earnings manipulation. Finally, the book examines the role played by competition culture in financial firms (i.e., banks). Specifically, the book explores the effect of competition culture on bank lending and shows that banks with greater levels of competition culture are generally more prone to engage in procyclical lending activity. The findings of the book have significant policy implications and will be of interests to regulators, accounting standard-setters, managers and those charged with firm governance, career academics and researchers, graduates, and those generally interested in the role played by corporate culture in the related fields of finance, economics, and accounting.

Download or read book Earnings Quality written by Jennifer Francis and published by Now Publishers Inc. This book was released on 2008 with total page 97 pages. Available in PDF, EPUB and Kindle. Book excerpt: This review lays out a research perspective on earnings quality. We provide an overview of alternative definitions and measures of earnings quality and a discussion of research design choices encountered in earnings quality research. Throughout, we focus on a capital markets setting, as opposed, for example, to a contracting or stewardship setting. Our reason for this choice stems from the view that the capital market uses of accounting information are fundamental, in the sense of providing a basis for other uses, such as stewardship. Because resource allocations are ex ante decisions while contracting/stewardship assessments are ex post evaluations of outcomes, evidence on whether, how and to what degree earnings quality influences capital market resource allocation decisions is fundamental to understanding why and how accounting matters to investors and others, including those charged with stewardship responsibilities. Demonstrating a link between earnings quality and, for example, the costs of equity and debt capital implies a basic economic role in capital allocation decisions for accounting information; this role has only recently been documented in the accounting literature. We focus on how the precision of financial information in capturing one or more underlying valuation-relevant constructs affects the assessment and use of that information by capital market participants. We emphasize that the choice of constructs to be measured is typically contextual. Our main focus is on the precision of earnings, which we view as a summary indicator of the overall quality of financial reporting. Our intent in discussing research that evaluates the capital market effects of earnings quality is both to stimulate further research in this area and to encourage research on related topics, including, for example, the role of earnings quality in contracting and stewardship.

Download or read book International Financial Reporting Standards and New Directions in Earnings Management written by Oliveira, Jonas da Silva and published by IGI Global. This book was released on 2019-03-22 with total page 342 pages. Available in PDF, EPUB and Kindle. Book excerpt: The fiscal market is an unpredictable torrent of information that modern organizations strive to understand. Business professionals dedicate themselves to understanding uncertain results around economic performance to improve management, reporting standards, and predict trends in financial statements. International Financial Reporting Standards and New Directions in Earnings Management is an essential reference source that discusses identifying the behavioral patterns of managers and the accounting policies they use in different opportunistic circumstances. Featuring research on topics such as earnings quality, risk reports, and investor protection, this book is ideal for regulatory authorities, accountants, impression managers, auditors, academics, students, and researchers seeking coverage on the theoretical, empirical, and experimental studies that relate to the different themes within earnings management.

Download or read book The Spillover Effects of MD A Disclosures for Real Investment written by Art Durnev and published by . This book was released on 2015 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt: We explore the association between a company's investments and the tone of its peers' MD&A disclosures; we ask whether the direction and the strength of this association is affected by product market competition. We find that the direction of the association can differ according to whether investing companies and disclosing peers in a product market have positive or negative interdependencies. Moreover, we document that the strength of the association between a company's investments and the tone of its peers' MD&A disclosures varies with product market fundamentals: the association is stronger when entry costs are lower, the product market is larger and products are less substitutable. Finally, we show that our results regarding investments generally carry over to investment efficiency.

Download or read book Advances in Investment Analysis and Portfolio Management New Series Vol 10 written by Cheng F. Lee and published by Center for PBBEFR & Ainosco Press. This book was released on 2020-12-01 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Advances in Investment Analysis and Portfolio Management (New Series) is an annual publication designed to disseminate developments in the area of investment analysis and portfolio management. The publication is a forum for statistical and quantitative analyses of issues in security analysis, portfolio management, options, futures, and other related issues. The objective is to promote interaction between academic research in finance, economics, and accounting and applied research in the financial community.

Download or read book The Effect of Exogenous Information on Voluntary Disclosure and Market Quality written by Sivan Frenkel and published by . This book was released on 2019 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: We analyze a model in which information may be voluntarily disclosed by a firm and/or by a third party, e.g., financial analysts. Due to its strategic nature, corporate voluntary disclosure is qualitatively different from third-party disclosure. Greater analyst coverage crowds out (crowds in) corporate voluntary disclosure when analysts mostly discover information that is available (unavailable) to the firm. Nevertheless, greater analyst coverage always improves the overall quality of public information. We base this claim on two market quality measures: price efficiency, which is statistical in nature, and liquidity, which is derived in a trading stage that follows the disclosure stage.

Download or read book Irreversibility Uncertainty and Investment written by Robert S. Pindyck and published by World Bank Publications. This book was released on 1989 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt: Irreversible investment is especially sensitive to such risk factors as volatile exchange rates and uncertainty about tariff structures and future cash flows. If the goal of macroeconomic policy is to stimulate investment, stability and credibility may be more important than tax incentives or interest rates.