IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v54y2023ics154461232300140x.html
   My bibliography  Save this article

Targeted poverty alleviation disclosure and analyst forecast accuracy: Evidence from a quasi-natural experiment

Author

Listed:
  • Wu, Wenxin
  • Xu, Minya
  • Zhou, Zixun

Abstract

Using the Targeted Poverty Alleviation (TPA) disclosure policy in China as a quasi-natural experiment, this paper analyzes the impact of firm TPA disclosure on analyst forecast accuracy based on a staggered difference-in-differences model. The results show a significant increase in the accuracy of analysts’ forecasts after firms’ disclosure of TPA information, and this effect is more pronounced for firms with greater information processing cost and firms with fewer covering analysts. Our study provides empirical evidence for regulators concerned with the information environment of capital market.

Suggested Citation

  • Wu, Wenxin & Xu, Minya & Zhou, Zixun, 2023. "Targeted poverty alleviation disclosure and analyst forecast accuracy: Evidence from a quasi-natural experiment," Finance Research Letters, Elsevier, vol. 54(C).
    • Handle: RePEc:eee:finlet:v:54:y:2023:i:c:s154461232300140x
    DOI: 10.1016/j.frl.2023.103767
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S154461232300140X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2023.103767?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yu, Sijia & Zhang, Junrui & Qiu, Meng, 2020. "Political uncertainty and analysts’ forecasts: Evidence from China," Finance Research Letters, Elsevier, vol. 36(C).
    2. Tat‐kei Lai & Adrian C.H. Lei & Frank M. Song, 2019. "The impact of corporate fraud on director‐interlocked firms: Evidence from bank loans," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 46(1-2), pages 32-67, January.
    3. Matthew Elliott & Benjamin Golub & Matthew O. Jackson, 2014. "Financial Networks and Contagion," American Economic Review, American Economic Association, vol. 104(10), pages 3115-3153, October.
    4. Qiang Cheng & Fei Du & Xin Wang & Yutao Wang, 2016. "Seeing is believing: analysts’ corporate site visits," Review of Accounting Studies, Springer, vol. 21(4), pages 1245-1286, December.
    5. Datta, Sudip & Doan, Trang & Iskandar-Datta, Mai, 2022. "Top executives’ gender and analysts' earnings forecasts," Finance Research Letters, Elsevier, vol. 47(PA).
    6. Armstrong, Christopher S. & Core, John E. & Guay, Wayne R., 2014. "Do independent directors cause improvements in firm transparency?," Journal of Financial Economics, Elsevier, vol. 113(3), pages 383-403.
    7. Yuyuan Chang & Wen He & Jianling Wang, 2021. "Government Initiated Corporate Social Responsibility Activities: Evidence from a Poverty Alleviation Campaign in China," Journal of Business Ethics, Springer, vol. 173(4), pages 661-685, November.
    8. Duchin, Ran & Ozbas, Oguzhan & Sensoy, Berk A., 2010. "Costly external finance, corporate investment, and the subprime mortgage credit crisis," Journal of Financial Economics, Elsevier, vol. 97(3), pages 418-435, September.
    9. Jarrad Harford & Feng Jiang & Rong Wang & Fei Xie, 2019. "Analyst Career Concerns, Effort Allocation, and Firms’ Information Environment," Review of Financial Studies, Society for Financial Studies, vol. 32(6), pages 2179-2224.
    10. Chen, Ester & Gavious, Ilanit, 2015. "Does CSR have different value implications for different shareholders?," Finance Research Letters, Elsevier, vol. 14(C), pages 29-35.
    11. Gillan, Stuart L. & Koch, Andrew & Starks, Laura T., 2021. "Firms and social responsibility: A review of ESG and CSR research in corporate finance," Journal of Corporate Finance, Elsevier, vol. 66(C).
    12. Wu, Wenxin & Zhang, Xuezhi & Zhou, Zixun, 2022. "Institutional investors' corporate site visits and pay-performance sensitivity," Pacific-Basin Finance Journal, Elsevier, vol. 76(C).
    13. Mahfuja Malik, 2015. "Value-Enhancing Capabilities of CSR: A Brief Review of Contemporary Literature," Journal of Business Ethics, Springer, vol. 127(2), pages 419-438, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hossain, Ashrafee T. & Masum, Abdullah-Al, 2022. "Does corporate social responsibility help mitigate firm-level climate change risk?," Finance Research Letters, Elsevier, vol. 47(PB).
    2. Wong, Jin Boon & Zhang, Qin, 2022. "Stock market reactions to adverse ESG disclosure via media channels," The British Accounting Review, Elsevier, vol. 54(1).
    3. Liu, Guangqiang & Liu, Tianbao, 2022. "Does individual investors’ dividend tax influence analyst forecast? Evidence from a quasi-natural experiment in China," Finance Research Letters, Elsevier, vol. 50(C).
    4. Ruichen Ma, 2023. "The sustainable development trend in environmental, social, and governance issues and stakeholder engagement: Evidence from mergers and acquisitions in China," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(6), pages 3159-3173, November.
    5. Nguyen, Linh Thi My & Nguyen, Phong Thanh, 2023. "The board profiles that promote environmental, social, and governance disclosure–Evidence from S&P 500 firms," Finance Research Letters, Elsevier, vol. 55(PA).
    6. Hossain, Ashrafee & Rjiba, Hatem & Saadi, Samir, 2022. "Judge Ideology and Corporate Sexual Orientation Equality," Finance Research Letters, Elsevier, vol. 49(C).
    7. Nianhang Xu & Nian Li & Rongrong Xie & Kam C. Chan, 2022. "The power of the market over government officials: Evidence from an anticorruption campaign in China," Financial Management, Financial Management Association International, vol. 51(4), pages 995-1030, December.
    8. Chen, Xin, 2021. "Lunar eclipses, analyst sentiment, and earnings forecasts: Evidence from China," International Review of Economics & Finance, Elsevier, vol. 76(C), pages 1007-1024.
    9. Kong, Dongmin & Ji, Mianmian & Liu, Shasha, 2022. "Does the mandatory disclosure of audit information affect analysts' information acquisition?," International Review of Financial Analysis, Elsevier, vol. 83(C).
    10. Xu Cheng & Dongmin Kong & Xinwei Zheng & Qi Tang, 2022. "Do foreign investors crowd out sell‐side analysts? Evidence from China," The Financial Review, Eastern Finance Association, vol. 57(4), pages 815-834, November.
    11. Piccotti, Louis R., 2017. "Financial contagion risk and the stochastic discount factor," Journal of Banking & Finance, Elsevier, vol. 77(C), pages 230-248.
    12. Brian Gibbons & Peter Iliev & Jonathan Kalodimos, 2021. "Analyst Information Acquisition via EDGAR," Management Science, INFORMS, vol. 67(2), pages 769-793, February.
    13. Jiang, Yahan & Wang, Cai & Li, Sha & Wan, Jing, 2022. "Do institutional investors' corporate site visits improve ESG performance? Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 76(C).
    14. Ling, Aifan & Li, Jinlong & Zhang, Yugui, 2023. "Can firms with higher ESG ratings bear higher bank systemic tail risk spillover?—Evidence from Chinese A-share market," Pacific-Basin Finance Journal, Elsevier, vol. 80(C).
    15. Bhaskar, Ratikant & Bansal, Shashank & Abbassi, Wajih & Pandey, Dharen Kumar, 2023. "CEO compensation and CSR: Economic implications and policy recommendations," Economic Analysis and Policy, Elsevier, vol. 79(C), pages 232-256.
    16. Shang, Duo & Yuan, Dongliang & Li, Dehui & Lin, Qi, 2023. "Independent directors’ geographic distance, high-speed railway, and corporate cash holdings," Economic Modelling, Elsevier, vol. 121(C).
    17. Sharif Mazumder & Louis R. Piccotti, 2023. "Systemic Risk: Bank Characteristics Matter," Journal of Financial Services Research, Springer;Western Finance Association, vol. 64(2), pages 265-301, October.
    18. Kumar, Vivek & Srivastava, Arpita, 2022. "Trends in the thematic landscape of corporate social responsibility research: A structural topic modeling approach," Journal of Business Research, Elsevier, vol. 150(C), pages 26-37.
    19. Jiraporn, Pornsit & Jumreornvong, Seksak & Jiraporn, Napatsorn & Singh, Simran, 2016. "How do independent directors view powerful CEOs? Evidence from a quasi-natural experiment," Finance Research Letters, Elsevier, vol. 16(C), pages 268-274.
    20. Shi, Huai-Long & Zhou, Wei-Xing, 2022. "Factor volatility spillover and its implications on factor premia," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 80(C).

    More about this item

    Keywords

    Targeted poverty alleviation; ESG; Analyst forecast; Information environment;
    All these keywords.

    JEL classification:

    • G00 - Financial Economics - - General - - - General
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

    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:eee:finlet:v:54:y:2023:i:c:s154461232300140x. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    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.