TY - JOUR
T1 - Local FinTech development and stock price crash risk
AU - Wang, Xinyue
AU - Cao, Yuqiang
AU - Feng, Zhuoan
AU - Lu, Meiting
AU - Shan, Yaowen
PY - 2023/5
Y1 - 2023/5
N2 - This study investigates the effect of financial technology (FinTech) development on stock price crash risk. We show that the development of FinTech can inhibit management from deliberately hiding bad news and alleviate information asymmetry, thereby reducing stock price crash risk. This effect is more pronounced among non-state-owned enterprises, firms with poor information environments and low-quality internal controls, and those in competitive industries and regions with high marketization. Overall, these findings suggest that FinTech development can mitigate the deliberate concealment of bad news by management and improve the timeliness of disclosure, leading to lower risks faced by investors.
AB - This study investigates the effect of financial technology (FinTech) development on stock price crash risk. We show that the development of FinTech can inhibit management from deliberately hiding bad news and alleviate information asymmetry, thereby reducing stock price crash risk. This effect is more pronounced among non-state-owned enterprises, firms with poor information environments and low-quality internal controls, and those in competitive industries and regions with high marketization. Overall, these findings suggest that FinTech development can mitigate the deliberate concealment of bad news by management and improve the timeliness of disclosure, leading to lower risks faced by investors.
KW - China
KW - Local FinTech development
KW - Stock price crash risk
UR - http://www.scopus.com/inward/record.url?scp=85149689575&partnerID=8YFLogxK
U2 - 10.1016/j.frl.2023.103644
DO - 10.1016/j.frl.2023.103644
M3 - Article
AN - SCOPUS:85149689575
SN - 1544-6123
VL - 53
SP - 1
EP - 12
JO - Finance Research Letters
JF - Finance Research Letters
M1 - 103644
ER -