Voting and Trading on Public Information
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SeriesErasmus Finance Seminars
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Speaker(s)Paul Voss (HEC Paris, France)
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FieldFinance, Accounting and Finance
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LocationErasmus University Rotterdam, Campus Woudestein, Sanders 0-12
Rotterdam -
Date and time
June 03, 2025
11:45 - 13:00
Abstract
This paper studies how public information, such as proxy advice, affects shareholder voting and, thus, corporate decision-making. Although public information improves the voting decisions of uninformed shareholders, it also induces privately informed shareholders to sell their shares rather than to vote. As a result, public information impairs information aggregation by voting but improves information aggregation by trading. We show that, overall, public information can undermine corporate decision-making. Furthermore, the effect of more precise public information on corporate decision-making is non-monotonic. Our results give rise to new empirical predictions and have implications for regulation. Joint paper with Markus Parlasca.