Conference calls and information asymmetry

Stephen Brown, Stephen A. Hillegeist, Kin Lo

Research output: Contribution to journalArticlepeer-review

207 Scopus citations


We hypothesize that conference calls are voluntary disclosures that lead to long-term reductions in information asymmetry among equity investors. Cross-sectional and time-series tests show that information asymmetry is negatively associated with conference call activity. Firms initiating a policy of regularly holding conference calls experience statistically and economically significant and sustained reductions in information asymmetry, in contrast to one-time callers, who experience no significant decline in asymmetry. Since prior work shows that the cost of equity capital is increasing in the level of information asymmetry, our results suggest that firms that hold conference calls more frequently have lower costs of capital.

Original languageEnglish (US)
Pages (from-to)343-366
Number of pages24
JournalJournal of Accounting and Economics
Issue number3
StatePublished - Sep 2004
Externally publishedYes


  • Conference calls
  • Information asymmetry
  • Microstructure
  • Probability of informed trade
  • Voluntary disclosures

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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