Dose analysts’ private information acquisition impact on stock price crash risk? Based on Chinese Market

Abstract

This paper selects A-share companies listed on China's Shanghai and Shenzhen stock exchanges from 2007 to 2021 as the research sample and empirically tests the correlation between analysts' private information acquisition ability and stock price crash risk, and finds that the improvement of analysts' private information acquisition ability will effectively reduce the expected stock price crash risk, and proves that the results are not affected by the endogeneity factors through a series of robustness tests, which are robust. Meanwhile, this paper finds that analysts' private information acquisition ability mainly weakens stock price crash risk by reducing information asymmetry through mediation mechanism analysis, and further finds that it reduces information asymmetry through the internal control efficiency path and the surplus forecasting path. Moreover, in the heterogeneity test, this paper finds that analysts' private information acquisition ability has a greater ability to influence stock price crash risk in firms with low industry concentration, large size, high audit quality or state-owned nature. The above results have important implications for capital markets and investors.