Author: Yoo, Jihye
Title: Information externality of paid-for-analysts
Advisors: Tsang, Albert (AF)
Degree: M.Phil.
Year: 2021
Subject: Financial instruments -- European Union countries
Investment analysis
Hong Kong Polytechnic University -- Dissertations
Department: School of Accounting and Finance
Pages: vi, 42 pages : color illustrations
Language: English
Abstract: The implementation of the Markets in Financial Instruments Directive II (MiFID II) in 2018 has increased demand for paid analysts' research service in Europe. In this research, using a hand-collected dataset of the paid analysts' research service in Europe and employing a difference-in-differences research design, I find that financial analysts tend to make more accurate earnings forecasts for non-paying firms in the same industry of their paying firms than non-paying firms in the different industry after they are appointed as paid-for-analysts by the paying firms for their service. I also find that relative to non-paying firms with a better information environment, non-paying firms with weaker information environments tend to exhibit a greater level of improvement in analyst earnings forecast accuracy after the appointment of the analysts for their research services. Similarly, I also find that paid-for¬≠analysts tend to cover more non-paying firms in the same industry of their paying firms after their appointment of paid-for-analysts. Overall, the findings of this study are consistent with the conjecture that paid-for-analysts' greater level of access to paying firms' private information facilitates their earnings forecasts of non-paying firms.
Rights: All rights reserved
Access: open access

Files in This Item:
File Description SizeFormat 
5795.pdfFor All Users891.45 kBAdobe PDFView/Open

Copyright Undertaking

As a bona fide Library user, I declare that:

  1. I will abide by the rules and legal ordinances governing copyright regarding the use of the Database.
  2. I will use the Database for the purpose of my research or private study only and not for circulation or further reproduction or any other purpose.
  3. I agree to indemnify and hold the University harmless from and against any loss, damage, cost, liability or expenses arising from copyright infringement or unauthorized usage.

By downloading any item(s) listed above, you acknowledge that you have read and understood the copyright undertaking as stated above, and agree to be bound by all of its terms.

Show full item record

Please use this identifier to cite or link to this item: