Keywords
Stock Price Synchronicity
Information Efficiency
How to Cite
Abstract
The high-quality development of China's capital market and the modernization of national governance are advancing in a coordinated manner, and inspection supervision plays a critical role in improving market information efficiency. Based on data from Chinese A-share non-financial listed companies from 2009 to 2024, this paper examines the effect of inspection supervision on corporate stock price synchronicity. The results show that inspection supervision significantly reduces the stock price synchronicity of listed firms. Mechanism tests indicate that inspection supervision reduces stock price synchronicity mainly by increasing analyst attention and promoting corporate digital transformation. Heterogeneity tests further show that the inhibitory effect of inspection supervision on stock price synchronicity is more pronounced among firms located in western China, firms in high-tech industries, and firms with higher institutional investor ownership. The conclusions of this paper not only enrich the literature on the economic consequences of inspection supervision and the determinants of stock price synchronicity, but also provide empirical evidence for improving the inspection supervision system and enhancing the pricing efficiency of the capital market.
References
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