Disclosure and Investor Inattention: Theory and Evidence

• 成果类型: Article
• 署名作者: Bertomeu, Jeremy; Hu, Peicong (Keri); Liu, Yibin
• 署名单位: Washington University (WUSTL); University of Hong Kong; National University of Singapore
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/TAR-2022-0122
• 发表日期: 2023
• 页码: 1-36
• 关键词: information; dispersion; attention; MARKETS; FLOWS

摘要

Investors have a finite capacity to organize all information they receive from financial disclosures. Under rational inattention, we show that investor processing capacity affects the probability of disclosure. Our main result is that the likelihood of disclosure is inverse-U shaped in investor attention. For low levels of attention, more attention facilitates communication and increases disclosure; for high levels of attention, more attention better identifies, and therefore deters, unfavorable voluntary disclosures. We provide empirical evidence that the relationship between investor attention and management forecast follows the predictions of the theory, using institutional ownership as a proxy for investor attention as well as exogenous shocks to fund manager distraction.