Abstract

http://ssrn.com/abstract=2449341
 


 



The Price of Silence: When No One Asks Questions During Conference Calls


Shuping Chen


University of Texas at Austin - Red McCombs School of Business

Stephan Hollander


Tilburg University - Tilburg School of Economics and Management

Kelvin Law


Tilburg University

June 12, 2014


Abstract:     
We document economically significant indirect costs of providing conference calls — increase in information asymmetry and more negative immediate market reaction — when managers fail to elicit questions during the calls’ question-and-answer (Q&A) session. We establish this result by focusing on earnings calls where managers fetch either zero questions or “too few” questions when they open the floor for questions. We extend the literature on conference calls as an important corporate communication medium by examining hereto unexamined costs, and propose remedies for firms to avoid such indirect costs of corporate communication.

Number of Pages in PDF File: 49

Keywords: conference calls, corporate disclosure, information asymmetry, price penalty

JEL Classification: M41, G12, G14

working papers series


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Date posted: June 14, 2014 ; Last revised: June 17, 2014

Suggested Citation

Chen, Shuping and Hollander, Stephan and Law, Kelvin, The Price of Silence: When No One Asks Questions During Conference Calls (June 12, 2014). Available at SSRN: http://ssrn.com/abstract=2449341 or http://dx.doi.org/10.2139/ssrn.2449341

Contact Information

Shuping Chen (Contact Author)
University of Texas at Austin - Red McCombs School of Business ( email )
Austin, TX 78712
United States
521.471.5328 (Phone)
Stephan Hollander
Tilburg University - Tilburg School of Economics and Management ( email )
P.O. Box 90153
Tilburg, DC 5000 LE
Netherlands
+31 13 466 8288 (Phone)
+31 13 466 8001 (Fax)
HOME PAGE: http://www.uvt.nl/people/s.hollander
Kelvin Law
Tilburg University ( email )
P.O. Box 90153
Tilburg, 5000 LE
Netherlands
HOME PAGE: http://sites.google.com/site/kelvinlaw2012
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