We explore whether Management Discussion and Analysis (MD&A) can provide incremental information to peers. Using Chinese stock market data, we find that positive peers' MD&A tone encourages firms to hold more cash, particularly for industries with fewer institutional investors' site visits. Moreover, this association is moderated by predation risk and decision-making environment. Specifically, this effect is more pronounced for firms which are market followers or financial constrained, and it is also stronger for firms operating under higher economic policy uncertainty or solely in domestic market. Overall, our findings enrich the information channels of peer effects in cash policy.
LIN TING ;
SHUCHANG HE ;
MAOLIN WANG ;
YAXUAN YAN ;
The Influence of Peers' Md&A Tone on Corporate Cash Holdings （2023年01月11日）http://www.cfrn.com.cn//lw/gsjr/gszllw/d2e29972bc8646848984b3cb20c0a520.htm