2012
DOI: 10.2139/ssrn.1944328
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The Effects of Public Information with Asymmetrically Informed Short-Horizon Investors

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Cited by 14 publications
(14 citation statements)
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“…Assuming exogenous information, prior literature primarily focuses on the insight from Morris and Shin (2002) that beauty contest incentives lead agents to put greater weight on information that is more public in nature. This effect underlies the findings in Gao (2008) and Chen et al (2014) in the context of short-horizon trading, Arya and Mittendorf (2016) and Chen et al (2017) in the context of investment complementarities, and Anctil et al (2004), Banerjee and Maier (2016), Qu (2013), and Liang and Zhang (2014) in the context of bank runs. We are the first to introduce the insight of Myatt and Wallace (2012) with endogenous information acquisition.…”
Section: Introductionsupporting
confidence: 62%
“…Assuming exogenous information, prior literature primarily focuses on the insight from Morris and Shin (2002) that beauty contest incentives lead agents to put greater weight on information that is more public in nature. This effect underlies the findings in Gao (2008) and Chen et al (2014) in the context of short-horizon trading, Arya and Mittendorf (2016) and Chen et al (2017) in the context of investment complementarities, and Anctil et al (2004), Banerjee and Maier (2016), Qu (2013), and Liang and Zhang (2014) in the context of bank runs. We are the first to introduce the insight of Myatt and Wallace (2012) with endogenous information acquisition.…”
Section: Introductionsupporting
confidence: 62%
“…Assuming exogenous information, prior literature primarily focuses on the insight from Morris and Shin (2002) that beauty contest incentives lead agents to put greater weight on information that is more public in nature. This effect underlies the findings in Gao (2008) and Chen et al (2014) in the context of short-horizon trading, Arya and Mittendorf (2016) and Chen et al (2017) in the context of investment complementarities, and Anctil et al (2004), Banerjee and Maier (2016), Qu (2013), and Liang and Zhang (2014) in the context of bank runs. We are the first to introduce the insight of Myatt and Wallace (2012) with endogenous information acquisition.…”
Section: Introductionsupporting
confidence: 62%
“…They find that the type of disagreement affects whether it increases or decreases cost of capital. Chen et al (2014) find that the liquidation price uncertainty that investors face causes them to trade less aggressively. However, this effect is not proportionate to the precision of their private information; investors with more precise information scale back their trades more.…”
mentioning
confidence: 97%
“…While our paper focuses on the relation between information, liquidity, and cost of capital by relaxing the assumption of perfection competition among investors in markets, another strand of literature explores these relations in models where investors have different time horizons. For example, Bloomfield and Fischer (2011) and Chen, Huang, and Zhang (2014) analyze cost of capital in overlapping generations' models. First generation investors must liquidate their shares early; they cannot hold shares until the firm's ultimate cash flows occur.…”
mentioning
confidence: 99%