Discretionary Dissemination on Twitter

60 Pages Posted: 1 Feb 2018 Last revised: 13 Aug 2023

See all articles by Richard M. Crowley

Richard M. Crowley

Singapore Management University - School of Accountancy

Wenli Huang

Hong Kong Polytechnic University

Hai Lu

University of Toronto - Rotman School of Management

Date Written: August 10, 2023

Abstract

Using an unsupervised machine learning approach to analyze 24 million tweets posted by S&P 1500 firms from 2012 to 2020, we find that firms are more likely to tweet financially related messages around significantly negative or positive news events such as earnings announcements and the filings of financial statements. Such a convex U-shaped relation between the likelihood of posting financial tweets and the materiality of accounting events becomes stronger over time. The evidence suggests that the conclusions drawn on earnings announcements using an early period sample – that firms are less likely to disseminate information on Twitter when the news is bad and material – should be revised. We also show that a machine learning algorithm (Twitter-LDA) is superior to a dictionary approach in classifying short messages like tweets. Our intraday analyses provide consistent evidence.

Keywords: Social Media, Discretionary Dissemination, Disclosures, Twitter

JEL Classification: G14, L30, M14, M15, M40

Suggested Citation

Crowley, Richard M. and Huang, Wenli and Lu, Hai, Discretionary Dissemination on Twitter (August 10, 2023). Rotman School of Management Working Paper No. 3105847, Singapore Management University School of Accountancy Research Paper No. 2022-148, Available at SSRN: https://ssrn.com/abstract=3105847 or http://dx.doi.org/10.2139/ssrn.3105847

Richard M. Crowley

Singapore Management University - School of Accountancy ( email )

60 Stamford Road
Singapore 178900
Singapore

HOME PAGE: http://rmc.link

Wenli Huang

Hong Kong Polytechnic University ( email )

School of Accounting and Finance
Hung Hom, Kow Loon, Hong Kong
Hong Kong

Hai Lu (Contact Author)

University of Toronto - Rotman School of Management ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada

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