京都大学 大学院経済学研究科・経済学部

(Title) 

"Burdening the Young: Life Cycle Effects of Mandatory Disclosure on Investment"

Abstract:
Mandatory disclosure burdens initially suppress the R&D investment and investment efficiency of newly public firms, but this relation attenuates as firms become more seasoned. Consistent with the mandatory disclosure-investment relation being rooted in information frictions leading firms to focus on short-term metrics at the expense of long-term investments, this effect is strongest for young IPO firms and firms that continue expanding their public float most after they go public. Our results suggest a life cycle effect whereby disclosure burdens impact corporate investment policy via interactions with newly public firms' elevated information asymmetry and incentives to maximize current share price.