R&D manipulation and SEO pricing in the Chinese capital market: The information effect of inefficient investment

被引：12
作者：
Liu, Duan [1 ]
Wang, Lili [1 ]
Yan, Jing [1 ]
Wan, Hong [2 ]
机构：
[1] Hunan Univ, Business Sch, Changsha, Peoples R China
[2] SUNY Coll Oswego, Sch Business, Oswego, NY 13126 USA
来源：
RESEARCH IN INTERNATIONAL BUSINESS AND FINANCE | 2023年 / 65卷
关键词：
InefficientR&D investment; Seasoned equity offerings; Pricing; Informational asymmetry; EARNINGS MANAGEMENT; REAL ACTIVITIES; FINANCING CONSTRAINTS; FORECAST REVISIONS; CROSS-SECTION; AGENCY COSTS; ASYMMETRY; HARMFUL; MATTER; GROWTH;
D O I：
10.1016/j.ribaf.2023.101946
中图分类号：
F8 [财政、金融];
学科分类号：
0202 ;
摘要：
While the literature finds that R&D management is used to inform investors, it is unclear how R&D manipulation affects pricing in security issuance because R&D management and its motives are difficult to detect. Using a group of Chinese listed companies that conducted seasoned equity offerings (SEOs) between 2007 and 2020, we examine the effect of inefficient R&D investment on SEO pricing. Our results affirm the mechanism of misleading by utilizing information asymmetry and show that under-investment in R&D drives up SEO prices, especially in firms with low profitability; over-investment in R&D would also raise SEO prices, but only for R&D-intensive industries. However, these impacts are weakened when information asymmetry is reduced. In-ternal investor subscription and external analyst coverage improve the information environment and suppress the information effect of inefficient R&D investment on SEO pricing.
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页数：18
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