Public Release Of Information Research Articles

Ask more, awarded more: Evidence from Taiwan’s courts

Whether a plaintiff is awarded more simply because she has asked for more is a fascinating question. The existing studies are predominantly experimental, as the “control group” in the experiments hardly exists in reality. Using Taiwan’s transaction data on land sales and leases to control for case differences, and matching them with adjudications in the court data, we show that the plaintiff’s claim, even if not based on market evidence, increases the judge’s award. Simultaneous equations model allows us to control for the unobsevables that affect both claims and awards. We also show that the release of public information weakens this effect.

Short-Selling and Information Arrival around Earnings Announcements: Evidence from Regulation SHO

ABSTRACTShort sellers assist in impounding negative news more quickly into stock prices and improve price informativeness. However, there is a lack of consistent evidence about whether short sellers trade predominantly in anticipation of, or in response to, a public information release. To shed light on this question, we exploit Reg SHO, which reduced the constraints faced by short sellers for a subsample of U.S. firms, to examine price informativeness before, during, and after earnings announcements. We show that relative to control firms, pilot firms have greater (less) price informativeness before (during) earnings announcements, suggesting that short sellers trade in anticipation of public earnings news, rather than in response to the public news.Data Availability: Data are available from the public sources cited in the text.JEL Classifications: M40; M41; M48.

The More We Know, the Less We Agree: A Test of the Trading Horizon Heterogeneity Theory

We examine the Kondor theoretical explanation of an enduring puzzle: trading volumes and stock return volatility peak after the release of public information. Using a comprehensive data set of institutional holdings and earnings announcements, we find supporting evidence that the proportion of short-term investors is positively associated with post-announcement spikes in trading volume and return volatility. This finding survives in the identification test based on the annual reconstitutions of the Russell 1000 and 2000 indices. We show our results largely withstand several alternative explanations related to the constitution of institutional investors, informed trading, and heterogeneous beliefs.

The more we know, the less we agree: A test of the trading horizon heterogeneity theory

AbstractWe examine the Kondor theoretical explanation of an enduring puzzle: trading volumes and stock return volatility peak after the release of public information. Using a comprehensive data set of institutional holdings and earnings announcements, we find supporting evidence that the proportion of short‐term investors is positively associated with post‐announcement spikes in trading volume and return volatility. This finding survives in the identification test based on the annual reconstitutions of the Russell 1000 and 2000 indices. We show our results largely withstand several alternative explanations related to the constitution of institutional investors, informed trading, and heterogeneous beliefs.

Revising A Voluntary Disclosure Decision

ABSTRACTPublic information that becomes available after a manager's initial voluntary disclosure decision creates incentives for her to reconsider and possibly change that decision. We show that if she has private information that is value-relevant or that impacts the firm's ability to compete in its product market, the option to revise an initial disclosure decision in the face of a public release of information alters both the initial decision and the overall frequency of disclosure. These effects are amplified if she believes that public information arrival is more likely or if the firm's value is more sensitive to it. We also show that an increase in the initial disclosure cost reduces the probability of an initial disclosure and increases the probability of a subsequent disclosure. These effects are reversed if the cost of a subsequent disclosure increases.

‘The scarlet letters’: Information disclosure and self-regulation: Evidence from antibiotic use in Denmark

This article presents the first empirical estimates regarding the impact of information disclosure on farmers’ economic behavior in terms of antibiotic use. We used the Danish government’s public release of information regarding antibiotic use among pig farms in summer 2010 as a quasi-experiment to exploit the variation in the intensity of damage to farmers’ reputation. The study finds that the information disclosure has induced a significant (20–30%) reduction in pig farmer’s subsequent antibiotic use, with the largest reductions for farms specialized in finisher pig production, both when evaluating the volume of active compounds and the number of prescribed doses. The results also show that the public disclosure has no effect on the survival of farmers in the market, however; it has induced input substitution in terms of increased purchase of vaccines.

Must Public Information Always Crowd Out Private Information?

This paper studies the impacts of public information release in a class of models with strategic information acquisition. Due to the presence of strategic complementarity, multiple equilibria can arise, creating difficulty in analyzing comparative statics. We develop a methodology to apply global-game refinement in this setting and use it to study a model with a dynamic complementarity in information acquisition. The resulting unique equilibrium is shown to have a property that none of the underlying equilibria have: while in all the underlying equilibria public information always crowds out private information, in the global-game equilibrium public information can crowd in more private information acquisition. The crowding-in effect is more pronounced when fundamental uncertainty is high and reverts back to crowding out when uncertainty is low. Omitting this effect could lead the regulator to disclose too little public information especially in recessions, which are often associated with rising uncertainty.

DMB+, a General Data Transmission Technique

Developed from Digital Multimedia Broadcasting (DMB), DMB+ changes the application focus fundamentally. The plus symbol “+” indicates that DMB+ is no longer for digital radio/videos, instead it works as a general data transmission technique. The merits of wireless transmission, broad coverage, high quality, information security and low building/maintenance cost make DMB+ suitable for a wide range of applications with numerous terminals and users, such as public information release, alarm and administration etc. The concept of DMB+ base station enables DMB+ to be used in building independent networks and for remote control and management, as well as for Industry 4.0. DMB+ will access into a new field that till now has been dominated by communication techniques, will open a huge commercial opportunity.

Nursing Home Competition, Prices and Quality: A Review and Some Lessons for Australia

In recent years, with the aim of containing cost pressure and improving efficiency, many countries have begun to introduce market mechanisms into the aged care sector. Under the right conditions, competition can spur providers to compete by cutting costs, offering better prices and higher quality of services. However, in aged care, market failures can be severe. Information about prices and quality may not be readily available and search costs can be high. This study undertakes a scoping review of the literature on competition in the nursing home sector, with an emphasis on research examining how competition affects prices and quality of care. Online databases were used to identify studies in English language published between 1988–2020. A total of 44 publications covering nine countries are included in this review. On the relationship between competition and quality, the literature offers conflicting evidence. Some studies find greater competition leading to higher quality, while others find the opposite effect. Institutional features such as the presence of binding supply restrictions on nursing homes and public release of information on quality appear to be important considerations. On the price effect of competition, most studies find that greater competition tends to result in lower prices, although the effect is small. The literature offers several lessons for Australia, including whether increasing subsidies can result in higher quality and the role of public reporting of quality ratings in fostering competition.

Day-of-Week Effect on Stock Market Return, Volatility and Trade Volume: Evidence from Dhaka Stock Exchange (DSE)

This paper estimates the day-of-the-week effect on the market return, volatility of market returns and trade volume of DSE using conditional variance model. Empirical results of this paper indicate that the day-of-the-week effect in DSE does exist in case of market return, volatility of market return and trade volume over the study period of 2005 to 2018. It is evident that lowest return, highest volatility, and lowest trading volume occur on the Sundays. Returns of Mondays and Wednesdays are significantly low; however, trade volume is low on Mondays and high on Wednesdays. The patterns of volatility manifest in this study, nevertheless, do not disprove the public information release hypothesis. After two days break of trading, investors start their trading on Sunday with lots of new information, which lead to more adjustments in portfolios and thus produces higher volatility.

Rumor rationales: The impact of message justification on article credibility

We perform content analysis on a unique sample of 2074 first-instance published takeover rumors to study how the rationale underlying a publication relates to its credibility and its association with firm returns and rumor accuracy. While most takeover rumors are inaccurate, we find that distinguishing between various justifications of potential takeover activity as provided within the published article serves to predict takeover announcements, subsequent firm abnormal returns, and – to a lesser extent – premiums. In addition, we note a clear distinction in results based upon the informative versus speculative nature of the rumor. We interpret this evidence as supportive of our hypothesis that the underlying rationale justifying the release of public information affects firm share prices and aids in predictability.

Accountability and yardstick competition in the public provision of education

This paper explores the institutional change introduced by the public disclosure of an education development index (IDEB, Basic Education Development Index) in 2007 to identify the effect of education accountability on yardstick competition in educational spending among Brazilian municipalities. An exploratory analysis of the data shows a minor reduction (20%) in spatial interaction in public educational spending after IDEB disclosure—compared with the spatial correlation before disclosure of the index. Our main results explore a discontinuity around the cutoff of 30 students enrolled in the grade under assessment after IDEB disclosure. The estimates suggest that the spatial autocorrelation—and, thus, yardstick competition—is reduced by 52%. Falsification and robustness tests were performed and suggest that we can claim causality around small bandwidths of the cutoff. This finding suggests that the public release of information may decrease the importance of neighbors’ information on voters’ decisions.

Do information releases increase or decrease information asymmetry? New evidence from analyst forecast announcements

Prior literature documents that both earnings announcements and management earnings forecasts increase information asymmetry at announcement. In contrast, we predict and document that analyst earnings forecasts decrease information asymmetry at announcement. As expected, this directional contrast is temporary, in that all three information release types lead to a decrease in information asymmetry following the short-window announcement period. Our evidence demonstrates that the direction of the effect of a public information release on announcement-period information asymmetry is determined by how the information contained in the release relates to prior information held by sophisticated and unsophisticated investors, which supports extant disclosure theory.

Ethical challenges in designing and conducting medicine quality surveys

ObjectivesIn this paper we discuss the main ethical challenges related to the conduct of medicine quality surveys and make suggestions on how to address them.MethodMost evidence‐based information regarding medicine quality derives from surveys. However, existing research ethical guidelines do not provide specific guidance for medicine quality surveys. Hence, those conducting surveys are often left wondering how to judge what counts as best practice. A list of the main ethical challenges in the design and conduct of surveys is presented.Results and conclusionsIt is vital that the design and conduct of medicine quality surveys uphold moral and ethical obligations and analyse the ethical implications and consequences of such work. These aspects include the impact on the local availability of and access to medicines; the confidentiality and privacy of the surveyors and the surveyed; questions as to whether outlet staff personnel should be told they are part of a survey; the need of ethical and regulatory approvals; and how the findings should be disseminated. Medicine quality surveys should ideally be conducted in partnership with the relevant national Medicine Regulatory Authorities. An international, but contextually sensitive, model of good ethical practice for such surveys is needed.

Short sales constraints and price adjustments to earnings announcements: Evidence from the Hong Kong market

This study examines how short sales constraints affect the stock price adjustment to the release of public information in the Hong Kong Stock Exchange. Using a unique feature of this market that allows us to directly investigate the impact of short sales restriction, we find the following. First, non-shortable stocks react more strongly to the publication of negative information than shortable stocks do. Second, non-shortable stocks are overpriced before negative earnings announcements. Hence, part of the strong market reaction of non-shortable stocks on announcement day could be due to the correction of such overpricing. Third, the prices of non-shortable stocks reverse following the announcement of negative information, suggesting that investors overreact to negative information on announcement day. Fourth, it takes longer for the prices of non-shortable stocks to adjust to negative earnings information. On the whole, our results support the research that finds short sales restrictions reduce the efficiency of stock markets.

Selective revelation of public information and self-confirming equilibrium

We model aggregate information release, in a dynamic setting with random matching, as a conscious, preference-driven choice. We introduce a “planner”, who possesses and selectively reveals aggregate information. Aggregate information is gathered slowly, by taking small samples from the population, and can only be revealed after the dynamic process has stabilized. By selectively revealing information, the planner may upset a given self-confirming equilibrium, in order to achieve a preferred outcome for him. Hence, some self-confirming equilibria are “unstable” relative to public information release. We show that only equilibria supported by heterogeneous beliefs can be information-unstable. We provide several real-life examples of manipulation by means of public information, showing the relevance of the theoretical analysis.

Long‐run Effects of Minimum Trading Unit Reductions on Stock Prices

AbstractWe examine empirically the long‐run effects of reductions in minimum trading units (MTU) on stock prices in Japan from October 2001 to May 2008. When firms reduce their MTU, the number of individual shareholders tends to increase significantly for several years. We estimate buy‐and‐hold abnormal returns and find that positive stock returns are observed not only for the period between the announcement day and the actual date of MTU decreases, but also for a period of several years following MTU reductions. In addition, we measure stock price reactions to the release of public information before and after MTU reductions and find that stock prices react less to the release of positive information and more to the release of negative information after the MTU reductions. These findings, together with evidence of the change in the short and long positions of investors after the MTU reductions, indicate that individual investors face short‐sales constraints.

Short Sales Constraints and Price Adjustment to Earnings Announcements

This study looks at how short sales constraints affect the stock price adjustment to the release of public information in the Hong Kong Stock Exchange for a sample of 4,757 firm-event observations over the period 1994-2011. Using a unique feature of this market that allows us to directly investigate the impact of the imposition of short sales restriction, we find following results. First, nonshortable stocks react more strongly to negative information than shortable stocks. Second, nonshortable stocks are overpriced before the negative earnings announcement. Hence, part of the strong market reaction of nonshortable stocks on announcement day could be due to the correction of such overpricing. Third, prices of nonshortable stocks reverse following the announcement of negative information, suggesting that investors overreact to the negative information on the announcement day. Fourth, it takes longer time for the prices of nonshortable stocks to fully adjust to the negative earnings information. On the whole, our results are supportive of the stream of research that finds the imposition of short sales restrictions reduce the efficiency of stock markets.

Quality Improvement Under Nursing Home Compare

Changes in resident outcomes may be driven by many factors, including changes in nursing home care processes. Understanding what processes, if any, lead to successful improvements in resident outcomes could create a stronger case for the continued use of these outcome measures in nursing home report cards. To test the extent to which improvements in outcomes of care are explained by changes in nursing home processes, a setting where, to our knowledge, this link has not been previously studied. RESEARCH DESIGN/MEASURES: We describe facility-level changes in resident processes and outcomes before and after outcomes were publicly reported. We then assess the extent to which the changes in outcomes are associated with changes in nursing home processes of care, using the public release of information on nursing home outcomes as a source of variation in nursing home outcomes to identify the process-outcome relationship. All 16,623 US nursing homes included in public reporting from 2000 to 2009 in Online Survey, Certification and Reporting and the nursing home Minimum Data Set. Of the 5 outcome measures examined, only improvements in the percentage of nursing home residents in moderate or severe pain were associated with changes in nursing home processes of care. Furthermore, these changes in the measured process of care explained only a small part of the overall improvement in pain prevalence. A large portion of the improvements in nursing home outcomes were not associated with changes in measured processes of care suggesting that processes of care typically measured in nursing homes do little to improve nursing home performance on outcome measures. Developing quality measures that are related improved patient outcomes would likely benefit quality improvement. Understanding the mechanism behind improvements in nursing home outcomes is key to successfully achieving broad quality improvements across nursing homes.

Short Sales Constraints and Price Adjustment to Earnings Announcements

This study looks at how short sales constraints affect the stock price adjustment to the release of public information in the Hong Kong Stock Exchange for a sample of 4,757 firm-event observations over the period 1994-2011. Using a unique feature of this market that allows us to directly investigate the impact of the imposition of short sales restriction, we find following results. First, nonshortable stocks react more strongly to negative information than shortable stocks. Second, nonshortable stocks are overpriced before the negative earnings announcement. Hence, part of the strong market reaction of nonshortable stocks on announcement day could be due to the correction of such overpricing. Third, prices of nonshortable stocks reverse following the announcement of negative information, suggesting that investors overreact to the negative information on the announcement day. Fourth, it takes longer time for the prices of nonshortable stocks to fully adjust to the negative earnings information. On the whole, our results are supportive of the stream of research that finds the imposition of short sales restrictions reduce the efficiency of stock markets.