The effect of increased disclosure on cost of capital: Evidence from China

Review of Quantitative Finance and Accounting - Tập 27 - Trang 383-401 - 2006
Li Zhang1, Shujun Ding2
1Risk Management and Insurance, Haskayne School of Business, University of Calgary, Alberta, Canada
2Accounting Area, Haskayne School of Business, University of Calgary, Alberta, Canada

Tóm tắt

This study examined the relationship between disclosure and the cost of capital. Prior studies empirically testing this relationship provided mixed findings, and also raised several concerns, such as the endogeneity of disclosure, the information disclosure environment, and the sample size. This study investigated this relationship based on data from the Chinese capital market where a unique institutional arrangement makes the disclosure exogenous. This unique characteristic, in conjunction with a less stringent information environment and a big sample size, helped address these concerns. Our findings confirmed the negative relationship between disclosure and cost of capital.

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Thông tin xuất bản

Review of Quantitative Finance and Accounting

Tập 27

383-401

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