Mandated disclosure, stock returns, and the 1964 Securities Acts Amendments

• 成果类型: Article
• 署名作者: Greenstone, Michael; Oyer, Paul; Vissing-Jorgensen, Annette
• 署名单位: Massachusetts Institute of Technology (MIT); National Bureau of Economic Research; Stanford University; Northwestern University
• 刊物名称: QUARTERLY JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0033-5533
• DOI: 10.1162/qjec.2006.121.2.399
• 发表日期: 2006
• 页码: 399-460
• 关键词: investor protection; MARKET; INFORMATION; exchange; SEC

摘要

The 1964 Securities Acts Amendments extended the mandatory disclosure requirements that had applied to listed firms since 1934 to large firms traded Over-the-Counter (OTC). We find several pieces of evidence indicating that investors valued these disclosure requirements, two of which are particularly striking. First, a firm-level event study reveals that the OTC firms most affected by. the 1964 Amendments had abnormal excess returns of about 3.5 percent in the weeks immediately surrounding the announcement that they had begun to comply with the new requirements. Second, we estimate that the most affected OTC firms had abnormal excess returns ranging between 11.5 and 22.1 percent in the period between when the legislation was initially proposed and when it went into force. These returns are adjusted for the standard four factors and are relative to NYSE/AMEX firms, matched on size and book-to-market equity, that were unaffected by the legislation. While we cannot determine how much of shareholders' gains were a transfer from insiders of these same companies, our results suggest that mandatory disclosure causes managers to focus more narrowly on maximizing shareholder value.