Theory and Policy Seminar, Series 219

National Academy of Development and Strategy (NADS), RUC

Theory and Policy Seminar, Series 219

Market Feedback: Evidence from the Horse’s Mouth

Reported by: LIU Bibo（Tsinghua PBC School of Finance)

Moderator: Qin Cong (National Academy of Development and Strategy, Renmin University of China)

Time: Sep 29, 2025  14:00-15:10

Venue: Room 1133, 11th Floor, Lide Building

Abstract:

We surveyed all Chinese public firms in 2019 and 2022 to examine the real effects of financial markets. More than 90% of firms monitor the stock market for learning new information about real investment and for accessing external financing, suggesting the wide existence of real effects through a learning channel and a financing channel. Firms learn about information on dimensions on which aggregation of external information is valuable. To validate our survey approach, we conduct analysis to link firms’ survey responses to their characteristics and actions. Finally, we provide additional validation by exploring the setting of trading suspensions.