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The Issue Of Asymmetric Information Upon The Capital Market

Author

Listed:
  • Olga Plesco

    (Faculty of Economics and Business Administration within Alexandru Ioan Cuza University of Iasi, Romania)

  • Ludmila Sobol

    (Faculty of Economics and Business Administration within Alexandru Ioan Cuza University of Iasi, Romania)

Abstract

The capital market has an important role at the micro and macro economical level, having the capacity to mobilize resources and to place them in a productive manner. The relation between accounting and capital market started to be analyzed from the middle of XXth century, when the investors started to ask more details about the companies’ activity and not just general accounting values. The certainty is nowadays a part of the cost of information which is consciously assumed by the users differently in pre-crisis and crisis time. Informational asymmetry plays a double role through the participants on the capital market: positive one for those who use the lack of information of others with economic responsibility and negative when information holders use them to affect the other participants or users. This paper seeks to examine the impact of financial information on the level of the capital value of the companies in order to evaluate the influence and to establish the measures that must be applied to reduce the asymmetries between different users of that information.

Suggested Citation

  • Olga Plesco & Ludmila Sobol, 2013. "The Issue Of Asymmetric Information Upon The Capital Market," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 5(2), pages 254-266.
    • Handle: RePEc:jes:wpaper:y:2013:v:5:i:2:p:254-266
    as

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    File URL: http://www.ceswp.uaic.ro/articles/CESWP2013_V2_PLE.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    financial information; cost of capital; information asymmetry; performance; disclosure Romania;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • M49 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Other

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