Buzzwords?

52 Pages Posted: 18 Jun 2021 Last revised: 10 Dec 2021

See all articles by Sudheer Chava

Sudheer Chava

Georgia Institute of Technology - Scheller College of Business

Wendi Du

Georgia Institute of Technology - Scheller College of Business

Nikhil Paradkar

University of Georgia

Abstract

Identifying emerging technologies is challenging since the frontier of new technologies is always rapidly evolving and given the potential for significant uncertainty and hype surrounding these technologies. Using the pre-trained Bidirectional Encoder Representations from Transformers (BERT), a deep learning model for textual analysis, we construct a dictionary of terms and phrases that identifies emerging technologies as they material over time. We then study the response to the discussion of emerging technologies by analyzing the earnings conference calls of U.S. public firms from 2007 to 2019. We find that the discussion of emerging technologies is associated with a significantly positive immediate stock market reaction. This reaction is more pronounced when the discussed technologies are in their nascent stages, and when firms have prior innovation experience in related technology domains. Further, there is no evidence of a negative post--earnings call drift for the firms that discuss emerging technologies in their earnings calls. Our results suggest that the discussion of emerging technologies in earnings calls is not just hype, but conveys credible information to investors.

Keywords: Deep Learning, Natural Language Processing, Buzzwords, Emerging Technologies, Hype, Earnings Conference Calls

JEL Classification: O30, O31, O32, G14

Suggested Citation

Chava, Sudheer and Du, Wendi and Paradkar, Nikhil, Buzzwords?. Available at SSRN: https://ssrn.com/abstract=3862645 or http://dx.doi.org/10.2139/ssrn.3862645

Sudheer Chava

Georgia Institute of Technology - Scheller College of Business ( email )

800 West Peachtree St.
Atlanta, GA 30308
United States

HOME PAGE: http://https://fintech.gatech.edu

Wendi Du (Contact Author)

Georgia Institute of Technology - Scheller College of Business ( email )

800 West Peachtree St.
Atlanta, GA 30308
United States

Nikhil Paradkar

University of Georgia ( email )

Athens, GA 30602-6254
United States

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