RESEARCH ARTICLE
Manager-specific manipulation of tone and stock price synchronicity
Miao Jiang,
Bo Zhu,
Luxi Li,
Corresponding Author
Miao Jiang
School of Economics, Shanghai University, Shanghai, China
Correspondence
Miao Jiang, School of Economics, Shanghai University, Shanghai 200444, China.
Email: [email protected]
Search for more papers by this authorBo Zhu
School of Economics, Shanghai University, Shanghai, China
Search for more papers by this authorLuxi Li
Shanghai University of Finance and Economics, Shanghai, China
Zhejiang University of Finance and Economics, Hangzhou, Zhejiang, China
Shanghai Lixin University of Accounting and Finance, Shanghai, China
Search for more papers by this authorMiao Jiang,
Bo Zhu,
Luxi Li,
Corresponding Author
Miao Jiang
School of Economics, Shanghai University, Shanghai, China
Correspondence
Miao Jiang, School of Economics, Shanghai University, Shanghai 200444, China.
Email: [email protected]
Search for more papers by this authorBo Zhu
School of Economics, Shanghai University, Shanghai, China
Search for more papers by this authorLuxi Li
Shanghai University of Finance and Economics, Shanghai, China
Zhejiang University of Finance and Economics, Hangzhou, Zhejiang, China
Shanghai Lixin University of Accounting and Finance, Shanghai, China
Search for more papers by this authorAbstract
Using a sample of Chinese listed firms from 2008 to 2020, we find that manager-specific upward manipulation of tone in the Management Discussion and Analysis (MD&A) section is associated with greater stock price synchronicity. This suggests that upward tone manipulation decreases the stock's idiosyncratic information content. This relationship between abnormally positive tone and stock price synchronicity is negatively moderated by the firm's revenue growth rate, while investor irrational sentiment positively moderates this relationship. Additionally, positive tone manipulation significantly increases audit aggressiveness and decreases analyst optimism bias.
Open Research
DATA AVAILABILITY STATEMENT
The data that support the findings of this study are available from the subscribed databased indicated in the study. Restrictions apply to the availability of these data, which were used under license for this study.
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