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Confucian culture and analysts' earnings forecast accuracy

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  • Zhao, Yue
  • Li, Lixin

Abstract

This article's findings reveal that Confucian culture enhances the precision of analysts' earnings forecasts. Tests for heterogeneity demonstrate that in private enterprises and more marketized samples, Confucian culture's governance impact is more significant. This study offers empirical support for the notion that Confucian culture serves as a vital external oversight mechanism for businesses.

Suggested Citation

  • Zhao, Yue & Li, Lixin, 2024. "Confucian culture and analysts' earnings forecast accuracy," Finance Research Letters, Elsevier, vol. 65(C).
    • Handle: RePEc:eee:finlet:v:65:y:2024:i:c:s1544612324006196
    DOI: 10.1016/j.frl.2024.105589
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    References listed on IDEAS

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    1. Yan, Youliang & Xu, Xixiong & Lai, Jieji, 2021. "Does Confucian culture influence corporate R&D investment? Evidence from Chinese private firms," Finance Research Letters, Elsevier, vol. 40(C).
    2. Kun Luo & Sirui Wu, 2022. "Corporate sustainability and analysts' earnings forecast accuracy: Evidence from environmental, social and governance ratings," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 29(5), pages 1465-1481, September.
    3. Liu, Yu & Yang, Lingxuan & Xiong, Lu, 2023. "Performance commitments and the properties of analyst earnings forecasts: Evidence from Chinese reverse merger firms," International Review of Financial Analysis, Elsevier, vol. 89(C).
    4. Peter M. Clarkson, 2000. "Auditor Quality and the Accuracy of Management Earnings Forecasts," Contemporary Accounting Research, John Wiley & Sons, vol. 17(4), pages 595-622, December.
    5. Hou, Fei & Shen, Huayu & Wang, Ping & Xiong, Hao, 2023. "Signing auditors' cultural background and debt financing costs," International Review of Financial Analysis, Elsevier, vol. 87(C).
    6. Bing Han & Dong Hong & Mitch Warachka, 2009. "Forecast Accuracy Uncertainty and Momentum," Management Science, INFORMS, vol. 55(6), pages 1035-1046, June.
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    Keywords

    Confucian culture; Forecast accuracy;

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