Re-examining the Effects of Regulation Fair Disclosure Using Foreign Listed Firms to Control for Concurrent Shocks
University of Miami - School of Business Administration
University of Hong Kong - School of Business
Journal of Accounting and Economics, Vol. 41, pp. 271-292, September 2006
We re-examine the effects of regulation fair disclosure (Reg FD) using ADRs (who are exempt from Reg FD) to control for confounding events which affected all traded firms. Tests based on public information metrics (returns volatility, informational efficiency and trading volume) and on analyst information metrics (forecast dispersion and accuracy) suggest that Reg FD did not uniquely affect the US information environment. However, analyst report informativeness declined for US firms relative to ADR firms, providing evidence consistent with Reg FD achieving one of its objectives - reducing private information flows to analysts.
Keywords: Reg FD, foreign-listed firms. information environment
JEL Classification: M41, M45, M47, G38Accepted Paper Series
Date posted: September 8, 2006
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