Voluntary Disclosure and the Cost of Capital

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dc.contributor.authorClinch, Greg
dc.contributor.authorVerrecchia, Robert E
dc.date2023-05-17T15:38:57.000
dc.date.accessioned2023-05-22T11:48:19Z
dc.date.available2023-05-22T11:48:19Z
dc.date.issued2015-05-01
dc.date.submitted2016-10-04T13:00:53-07:00
dc.description.abstractWe investigate the association between voluntary disclosure and the risk-related discount investors apply to price. First, we study the association between (endogenous) disclosure choice and the discount in price induced by changes in the underlying model parameters: this informs empirical research that ignores endogeneity of disclosure by, for example, omitting the exogenous determinants of disclosure and the discount in price from the regressions employed. Second, we investigate the incremental effect of disclosure on the discount in price: this informs empirical research that controls for the direct effect of exogenous factors on the discount in price by, for example, including the exogenous variables in regression models employed. Finally, we examine the incremental effect of disclosure on the discount in price when changes in disclosure are not induced by changes in underlying exogenous parameters: this further informs empirical research that controls for the effect of exogenous factors on both the discount in price and disclosure, and focuses on the association between ‘unexplained disclosure’ and the discount.
dc.identifier.urihttps://repository.upenn.edu/handle/20.500.14332/1060
dc.legacy.articleid1116
dc.legacy.fields10.1177/0312896214529441
dc.legacy.fulltexturlhttps://repository.upenn.edu/cgi/viewcontent.cgi?article=1116&context=accounting_papers&unstamped=1
dc.source.beginpage201
dc.source.endpage223
dc.source.issue18
dc.source.issue2
dc.source.journalAccounting Papers
dc.source.journaltitleAustralian Journal of Management
dc.source.peerreviewedtrue
dc.source.statuspublished
dc.source.volume40
dc.subject.othercost of capital
dc.subject.othervoluntary disclosure
dc.subject.otherAccounting
dc.subject.otherBusiness Administration, Management, and Operations
dc.titleVoluntary Disclosure and the Cost of Capital
dc.typeArticle
digcom.identifieraccounting_papers/18
digcom.identifier.contextkey9230172
digcom.identifier.submissionpathaccounting_papers/18
digcom.typearticle
dspace.entity.typePublication
upenn.schoolDepartmentCenterAccounting Papers
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