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X Bots and Earnings Announcements

Author

Listed:
  • Jan Hanousek Jr.

    (Fogelman College of Business Economics, University of Memphis, United States of America)

  • Jan Hanousek

    (Department of Economics, Faculty of Business and Economics, Mendel University in Brno, Zemedelska 1, 613 00 Brno, Czech Republic; CEPR, London, UK)

  • Konstantin Sokolov

    (Fogelman College of Business Economics, University of Memphis, United States of America)

Abstract

This paper studies the rationale and effects of buying bots on X (former Twitter). We observe that a large amount of attention to corporate X accounts around earnings announcements is driven by bots. Bot activity is a significant predictor of investor disagreement, which is persistent in the long term. Moreover, bot activity increases analyst dispersion for the following quarterly earnings announcement. Consistent with managerial short-termism, bot activity often accompanies intense earnings management. Our results are robust to various specifications, including a matching approach indicating causal interpretation.

Suggested Citation

  • Jan Hanousek Jr. & Jan Hanousek & Konstantin Sokolov, 2023. "X Bots and Earnings Announcements," MENDELU Working Papers in Business and Economics 2023-92, Mendel University in Brno, Faculty of Business and Economics.
    • Handle: RePEc:men:wpaper:92_2023
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    References listed on IDEAS

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    More about this item

    Keywords

    analysts’ dispersion; artificial attention increase; earnings management; investors’ disagreement; quarterly earnings; X bots; Twitter bots;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation

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