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Does short sales deregulation affect qualitative information disclosure?

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  • Jie He
  • Kam C. Chan

Abstract

We examine the impact of short sales deregulation on firms' disclosure of non‐financial qualitative information. Our simple analytical model predicts that, after short sales deregulation and when the cost of disclosing proprietary qualitative information to the firm and its executives is sufficiently high, shortable firms respond by disclosing less proprietary and more non‐proprietary qualitative information than non‐shortable firms. Using a textual analysis of qualitative information about the supply chain, available in the management disclosure and analysis sections of the annual reports of a sample of Chinese firms, and applying a staggered difference‐in‐differences research design, we find evidence consistent with the model's prediction.

Suggested Citation

  • Jie He & Kam C. Chan, 2023. "Does short sales deregulation affect qualitative information disclosure?," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(S1), pages 1351-1380, April.
    • Handle: RePEc:bla:acctfi:v:63:y:2023:i:s1:p:1351-1380
    DOI: 10.1111/acfi.12976
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