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- Title
Internet searching and stock price informativeness: Evidence from Google withdrawal in China.
- Authors
Li, Shuxian; Liu, Xinheng
- Abstract
We analyze whether and how internet searching impacts stock price informativeness. Using the 2010 Google withdrawal in China as a quasi-natural experiment, we establish a causal effect between internet searching and stock price informativeness using a difference-in-difference framework. We find that firms with higher Google search volume experience a 10% decrease in stock price informativeness after the Google withdrawal. The negative effect of the Google withdrawal on stock price informativeness is pronounced in firms with more retail investors, larger state-ownership, and poor analysts' earnings forecasts. Our results suggest that retail investors can benefit from internet searching to collect and process firm-specific information more efficiently.
- Subjects
CHINA; INTERNET searching; INDIVIDUAL investors; EARNINGS forecasting; STOCK price forecasting; PRICE cutting
- Publication
PLoS ONE, 2024, Vol 19, Issue 3, p1
- ISSN
1932-6203
- Publication type
Article
- DOI
10.1371/journal.pone.0297160