Scandinavian Working Papers in Economics

Stockholm School of Economics Asia Working Paper Series,
Stockholm School of Economics, Stockholm China Economic Research Institute

No 2017-47: Top Executives on Social Media and Information in the Capital Market: Evidence from China

Xunan Feng and Anders C. Johansson ()
Additional contact information
Xunan Feng: Southwestern University of Finance and Economics
Anders C. Johansson: Stockholm China Economic Research Institute, Postal: Stockholm School of Economics, P.O. Box 6501, SE-113 83 Stockholm, Sweden

Abstract: Social media platforms are becoming increasingly important channels for information dissemination. This study examines how microblogging by top executives affects the information environment for listed firms in an emerging market. Using manually collected set from Sina Weibo, one of China’s most popular and largest social media platforms, we find that a board chair having a Weibo account is associated with the dissemination of more firm-specific information to the capital market. This result holds up to a battery of robustness tests. We also show that the relationship between board chairs’ Weibo usage and information dissemination is stronger for smaller firms, firms that went public more recently, and firms characterized by less analyst coverage. Findings in this study have important implications for the understanding of the role of social media in the dissemination process of corporate information.

Keywords: Social Media; Information dissemination; Capital market; Investors; China

JEL-codes: G12; G14; M41; N20

59 pages, November 17, 2017

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