IDEAS home Printed from https://ideas.repec.org/a/bla/jbfnac/v53y2026i2p613-645.html

New Entrants and Contract Redaction

Author

Listed:
  • Gary Chen
  • Xiaoli Tian
  • Miaomiao Yu

Abstract

Using the US Census data to capture new entrants, we find that incumbents are more likely to redact proprietary information embedded in material contracts when a greater number of new firms establish their businesses in the focal firm's industry. The effect remains significant when we measure new entrants by the net growth in the number of firms within an industry. Moreover, the effect of new entrants on contract redactions is significantly stronger when the focal firm has greater competition risk, lower dependence on external financing, and fewer foreign subsidiaries. Finally, we identify new entrants based on potential product entries through patents. These alternative aspects of new entrants are also linked to a significant increase in incumbents’ contract redactions. These results indicate that the presence of new entrants intensifies the influence of product market threats on incumbents’ disclosure decisions, leading to increased redaction of proprietary information in contracts.

Suggested Citation

  • Gary Chen & Xiaoli Tian & Miaomiao Yu, 2026. "New Entrants and Contract Redaction," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 53(2), pages 613-645, April.
    • Handle: RePEc:bla:jbfnac:v:53:y:2026:i:2:p:613-645
    DOI: 10.1111/jbfa.70028
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/jbfa.70028
    Download Restriction: no
    File URL: https://libkey.io/10.1111/jbfa.70028?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jbfnac:v:53:y:2026:i:2:p:613-645. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0306-686X .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.