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Information asymmetry, east–west cultural differences, and divergence in investor reactions

Lee, Seungho; Walker, Thomas; Zhang, Aoran; Zhao, Yunfei


Seungho Lee

Thomas Walker

Assistant Professor in Finance, risk and Banking

Yunfei Zhao


This paper investigates the divergence in investor behaviour between the United States and China following the abolition of the Chinese presidential term limit in 2018, which may, in part, have reflected the heterogeneous opinions expressed in public online media regarding this event. Compared with Chinese investors, the sentiment among US investors was considerably more pessimistic. Accordingly, we find that Chinese companies listed in the United States significantly underperformed relative to a sample of propensity score-matched firms listed in China. Additionally, we find that the political connectedness of firms to the Chinese government strongly influenced the stock prices of US-listed Chinese firms.


Lee, S., Walker, T., Zhang, A., & Zhao, Y. (2022). Information asymmetry, east–west cultural differences, and divergence in investor reactions. European Financial Management,

Journal Article Type Article
Acceptance Date Jul 15, 2022
Online Publication Date Aug 9, 2022
Publication Date Aug 9, 2022
Deposit Date Jul 27, 2022
Publicly Available Date Aug 10, 2024
Journal European Financial Management
Print ISSN 1354-7798
Electronic ISSN 1468-036X
Publisher Wiley
Peer Reviewed Peer Reviewed
Keywords General Economics, Econometrics and Finance; Accounting
Public URL
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