The U.S. Market Reaction to Regulation of Social Media Disclosures

Amanda Aw Yong*, Ching Tung Keung, Yuen Teen Mak

*Corresponding author for this work

Research output: Contribution to journalJournal articlepeer-review

3 Citations (Scopus)


This paper examines the U.S. stock market reaction to events leading up to the SEC's decision to regulate (and allow) the use of social media for firm disclosures. By using an event methodology, we compare the market reaction for firms that use Twitter extensively with a set of control firms. Measures include size-adjusted cumulative abnormal returns (CARs), bid-ask spread, analyst forecast revision and dispersion as proxies for market reaction. Results show that firms actively using Twitter for financial disclosures suffered negative CARs after the final event when the SEC released its final guidance on social media disclosures.

Original languageEnglish
Pages (from-to)85-110
Number of pages27
JournalInternational Journal of Business
Issue number2
Publication statusPublished - Jan 2017

Scopus Subject Areas

  • Business and International Management
  • Finance
  • Economics and Econometrics
  • Strategy and Management

User-Defined Keywords

  • accounting
  • regulation
  • disclosure
  • corporate governance


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