The Role of Dissemination in Market Liquidity: Evidence from Firms' Use of Twitter

摘要: Firm disclosures often reach only a portion of investors, which results in information asymmetry among and therefore lower market liquidity. This issue is particularly salient for firms that are not highly visible, as they tend to receive broad news dissemination via traditional intermediaries, such the press. paper examines whether can reduce by more broadly disseminating their news. To isolate impact dissemination, we focus our analysis on firms' use Twitter exploit 140-character message restriction. Specifically, using sample technology firms, examine send participants links press releases provided disclosure methods. We find this additional firm-initiated associated with abnormal bid-ask spreads greater depths, consistent reduction asymmetry. Moreover, result holds mainly them being need channel. also volume-based measure liquidity, positively