IDEAS home Printed from https://ideas.repec.org/a/eee/pacfin/v93y2025ics0927538x25002161.html
   My bibliography  Save this article

Artificial intelligence and stock price crash risk: Evidence from China: A pre-registered report

Author

Listed:
  • Xiao, Bai
  • Wenyao, Zhao

Abstract

While the rapid rise in corporate artificial intelligence (AI) investment is widely viewed as a strategic necessity, its impact on stock price crash risk remains contested. This pre-registered report argues two opposing predictions. On one hand, AI investment may mitigate the stock price crash risk via improving information transparency and external monitoring for firms. On the other hand, the centralized capital investment in AI and the uncertainty involved may increase the stock price crash risk. To identify these two possible predictions, we exploit the “New-generation Artificial Intelligence Polit Zone Policy” in China as an exogenous shock and examine the impact of AI investment on firms' stock price crash risk, along with the underlying mechanisms. Furthermore, we investigate whether AI investment affects firm value. This study contributes to the literature on the economic consequences of AI investment and provides new insights into stock price crash risk and corporate risk governance.

Suggested Citation

  • Xiao, Bai & Wenyao, Zhao, 2025. "Artificial intelligence and stock price crash risk: Evidence from China: A pre-registered report," Pacific-Basin Finance Journal, Elsevier, vol. 93(C).
    • Handle: RePEc:eee:pacfin:v:93:y:2025:i:c:s0927538x25002161
    DOI: 10.1016/j.pacfin.2025.102879
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0927538X25002161
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.pacfin.2025.102879?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

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    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:pacfin:v:93:y:2025:i:c:s0927538x25002161. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/pacfin .

    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.