We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Strategic Transparency and Informed Trading: Will Capital Market Integration Force Convergence of Corporate Governance?
- Authors
Perotti, Enrico C.; von Thadden, Ernst-Ludwig
- Abstract
Dominant investors can influence the publicly available information about firms by affecting the cost of information collection. Under strategic competition, transparency results in higher variability of profits and output. Thus, lenders prefer less transparency, since this protects firms when in a weak competitive position, while equity holders prefer more. Market interaction creates strategic complementarity in gathering information on competing firms, thus entry by transparent competitors will improve price informativeness. Moreover, as the return to information gathering increases with liquidity, increasing global trading may undermine the ability of bank control to keep firms opaque.
- Subjects
INVESTORS; CORPORATE governance; INDUSTRIAL management; FINANCIAL disclosure; INVESTOR relations (Corporations); ORGANIZATIONAL transparency; ETHICS
- Publication
Journal of Financial & Quantitative Analysis, 2003, Vol 38, Issue 1, p61
- ISSN
0022-1090
- Publication type
Article
- DOI
10.2307/4126764