Shall We Talk? The Role of Interactive Investor Platforms in Corporate Communication

By Charles M. C. Lee, Qinlin Zhong. Social Science Research Network, 2020

196 citations recorded by the source corpus.

Between 2010 and 2017, Chinese investors used an online platform to ask publicly-listed firms over 2.5 million questions, the vast majority of which received a reply from management within two weeks. Our analyses show that: (a) most questions reflect difficulties in integrating information that is already in the public domain; (b) the level of platform activity varies by market condition and company performance; and (c) higher platform activities are associated with decreases in firms’ cost-of-capital and increases in their market liquidity. Collectively, our results suggest interactive investor platforms (IIPs) can mitigate information processing costs and improve market price formation.

Subfields: Accounting, Finance, Management Science and Operations Research

View Paper: https://www.semanticscholar.org/paper/8d1148c2d29463888b5819ab75ef59976f5c38c7