Cookies?
Library Header Image
LSE Research Online LSE Library Services

The relative concentration of bad versus good news flows

Athanasakou, Vasiliki E. and Strong, Norman C and Walker, Martin (2014) The relative concentration of bad versus good news flows. Department of Accounting, The London School of Economics and Political Science, London, UK.

[img]
Preview
PDF - Updated Version
Download (522kB) | Preview

Abstract

This paper examines flows of bad and good news as a feature of the firm’s information environment. We argue that to the extent that managers delay reporting bad news, this leads to bad news being more concentrated. Measuring flows of bad and good news using flows of negative and positive abnormal stock returns, we find that firms with higher volatility of operations and managerial incentives to withhold bad news exhibit relatively more concentrated bad news flows. This relative concentration is also positively associated with lower earnings quality and a higher risk of shareholder litigation. Our results suggest that the relative concentration of bad and good news flows is related to the quality of the firm’s information environment.

Item Type: Monograph (Working Paper)
Official URL: http://www.lse.ac.uk/accounting/Home.aspx
Additional Information: © 2014 The Authors
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HE Transportation and Communications
H Social Sciences > HF Commerce > HF5601 Accounting
Sets: Departments > Accounting
Date Deposited: 11 Nov 2014 17:15
Last Modified: 02 Dec 2014 14:38
Funders: Economic and Social Research Council
URI: http://eprints.lse.ac.uk/id/eprint/60139

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics