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Government disclosure specificity and stock price synchronicity: Evidence from local government work reports in China

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  • Gong, Manning
  • Cao, Chunfang
  • Zhang, Yuheng

Abstract

Using machine learning methods to conduct a textual analysis of city government work reports in China, we measure the specificity of government disclosures and examine whether this specificity affects stock pricing efficiency. We find that more specific forward-looking information disclosed by local governments is associated with lower stock price synchronicity among local listed companies. This effect is more pronounced for companies operating in environments with high economic policy uncertainty.

Suggested Citation

  • Gong, Manning & Cao, Chunfang & Zhang, Yuheng, 2025. "Government disclosure specificity and stock price synchronicity: Evidence from local government work reports in China," Finance Research Letters, Elsevier, vol. 71(C).
    • Handle: RePEc:eee:finlet:v:71:y:2025:i:c:s1544612324014922
    DOI: 10.1016/j.frl.2024.106463
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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