The Impact of Social Media on Corporate Values: Is Information Asymmetry matter?

Abstract

When deciding whether to invest in a business, investors evaluate the firm's value. The greater an investor's reliance, the more valuable the company. Among the factors that affect the value of a company is social media usage. This study seeks to empirically examine the impact of social media usage on corporate values as mediated by information asymmetry. This study utilizes secondary data. This study employed both purposeful sampling with several specified criteria and proportional stratified random sampling. Multiple linear regressions, path analysis, and the Sobel test were utilized in this study. According to the findings of this study, social media enhance corporate value. If social media does not affect information asymmetry, then information asymmetry can reduce firm value; therefore, the conclusion of this study would be that information asymmetry cannot be a mediator between social media and firm value because social media in Indonesia is still used to convey information to customers and investors are more interested in a company's website than its social media presence.