Discussion of delegated trade and the pricing of public and private information

Taylor and Verrecchia (2015) show that idiosyncratic risk can be priced in efficient but imperfectly competitive equity markets. We discuss how the model is structured, how it might apply to the pricing of financial reporting quality, and how empiricists might test its predictions.

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Bibliographic Details
Published in:Journal of accounting & economics 2015-11, Vol.60 (2-3), p.104-109
Main Authors: Bloomfield, Matthew J., Bloomfield, Robert
Format: Article
Language:English
Subjects:
Accounting quality
Asset-pricing tests
Economic models
Efficient markets
Expected returns
Financial reporting
Idiosyncratic risk
Imperfect competition
Risk assessment
Risk premium
Securities markets
Stock prices
Studies
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Description
Summary:Taylor and Verrecchia (2015) show that idiosyncratic risk can be priced in efficient but imperfectly competitive equity markets. We discuss how the model is structured, how it might apply to the pricing of financial reporting quality, and how empiricists might test its predictions.
ISSN:0165-4101
1879-1980
DOI:10.1016/j.jacceco.2015.09.001