The impact of patent information disclosure on the stock returns of high-tech corporates: an event study

ABSTRACT

For high-tech listed companies, the disclosure of patent information in financial statements influences firms’ value. Using the event study method, we examine the stock market’s reaction to patent information in financial statements. After measuring patent information on six items and dividing the level of patent information disclosure into the high group and low group, the results show that patent information disclosure is associated with changes in stock return. In addition, the impact of patent information disclosure on the stock return of a firm depends on the credibility of the voluntarily disclosed patent information or its quality. When the credibility is high, the degree of patent information disclosure has a positive impact on the stock return, while when the credibility is low, the degree of patent information disclosure has a negative impact on the stock return. The findings shed light on the selection of patent information disclosure strategies and provide a basis for future scholars to study improvements in stock market efficiency.

KEYWORDS:

• Patent information
• stock abnormal returns
• event study method
• financial statements
• voluntary disclosure

JEL CLASSIFICATION:

• M40
• M41

Acknowledgment

We also thank Stefano Bianchini at the University of Strasbourg and seminar participants in the 81st Annual Meeting of the Academy of Management.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ Other models, such as the market-adjusted model, were also tested. Results do not change.

Additional information

Funding

This work is finacially supported by the National Nature Science Foundation [Grant No. 71974130]; the General project of Humanities and Social Sciences Research of the Ministry of Education of China [Grant No. 19YJA630112].