The Impact of Information Overload on Investment Decisions under the Information Disclosure System of STAR Market

Research Article
Open access

The Impact of Information Overload on Investment Decisions under the Information Disclosure System of STAR Market

Yameng Guo 1* , Yiting Liu 2 , Zhiyuan Pan 3 , Guoqin Bu 4
  • 1 School of International Business, Jinan University, Zhuhai 519000, China    
  • 2 School of International Business, Jinan University, Zhuhai 519000, China    
  • 3 School of International Business, Jinan University, Zhuhai 519000, China    
  • 4 School of International Business, Jinan University, Zhuhai 519000, China    
  • *corresponding author guoyameng@stu2019.jnu.edu.cn
Published on 21 March 2023 | https://doi.org/10.54254/2754-1169/4/20221051
AEMPS Vol.4
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-915371-17-1
ISBN (Online): 978-1-915371-18-8

Abstract

Due to the rise of the STAR Market, the information disclosure system has become a crucial component of registration, while a growing information overload issue has also emerged. This paper uses an experimental economics approach to investigate how information overload will affect investors in the STAR Market. And besides, this paper introduces investor experience as a moderating variable to analyse whether investor experience has an impact on the mechanism of action between information overload and investor decision making. The results show that in a stock market formed by real data, as the rate of effective information disclosure decreases, investors' returns decline and investors tend to make more rational decisions, with investor experience having less impacts on the moderating effect between the two. In response to this conclusion, this essay provides investors and policymakers with some options for fostering the growth of the STAR Market.

Keywords:

Information Overload, Investment Decision, Information Disclosure, STAR Market, Experimental Economics.

Guo,Y.;Liu,Y.;Pan,Z.;Bu,G. (2023). The Impact of Information Overload on Investment Decisions under the Information Disclosure System of STAR Market. Advances in Economics, Management and Political Sciences,4,174-184.
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References

[1]. Huang, D.S., Wang, H.: Science and technology innovation board: a new institutional supply. Theoretical discussion. 5, 117-122 (2019).

[2]. Jia, Y.H., Ning, J.H.: Research on performance evaluation of companies to be listed on science and technology innovation board under the IPO boom. Economic System Reform. 2, 102-108(2021).

[3]. Guo, C.C., Zhang, C.: Exploration on the institutional innovation of “science and technology innovation board”. Theoretical exploration. 6, 92-98(2021).

[4]. Xi B., Zhang W. W.: Environmental information disclosure and business performance of firms--a test of mediating effects based on investors' concerns. Technology Economics, 41(05), 85-96(2022).

[5]. Li, H.X.: Information Disclosure Supervision: A Smooth and Optimized Path to Mandatory Disclosure. Chongqing Administration, 21(04), 70-72(2020).

[6]. Brown, J. S., Duguid, P. 1st ed.: The social life of information. Harvard Business School Press: Boston, United States, pp.105(2000).

[7]. Troy A.: Paredes, Blinded by the Light: Information Overload and Its Consequences for Securities Regulation. SSRN Electronic Journal (2003).

[8]. Susanna K. R.: The Dangers and Drawbacks of the Disclosure Antidote: Toward A More Substantive Approach to Securities Regulation, Baylor Law Review, 58, 1(2006).

[9]. Zhou G., Fan Q., Wang Y.D.: Information disclosure, price discrimination and crowdfunding performance. Journal of Shanxi University of Finance and Economics, 42(09), 44-57(2020).

[10]. Yang G.: Research on differentiated information disclosure of listed company. Doctor, Southwest University of Political Science and Law, China(2015).

[11]. Li D.X., Li X.D., Xiao B.Q.: Investors Experience, Reinforcement Learning and Stock Market Stability: A Survey, 01, 43-48+54(2011).

[12]. Tang, C.L., Xiang, R.J., Luo, Z.H., et al.: The impact of individual investors' sentiment on corporate social responsibility. Financial Theory and Practice, 42(06), 147-153(2021).

[13]. Xue, Z.Y., Wu, D.H.: Does information overload affect investors' use of public information-empirical evidence from quarterly surplus. Accounting Research, 6, 57-65+96(2004).

[14]. Sun L.: Research on the path of promoting the reform of stock issuance registration system. Shanghai Economic Research, 07, 16-27(2015).

[15]. Fu D., Liao Y.: Analysis of the legal adaptability of information disclosure to investors in the registration system of securities issuance. Journal of Jiangxi University of Finance and Economics, 06, 109-116(2016).

[16]. Pan C.M., Meng Z.J.: Analysis of factors influencing disclosure information overload of listed companies. Modern Trade Industry, 25(14), 17-19(2013).

[17]. Milford, J.T., Perry, R.P.: A methodological study of overload. The Journal of General Psychology, 97, 131-137(1977).

[18]. Streufert, S.C.: Effects of information relevance on decision making in complex environments. Memory & Cognition, 1(3): 224–228(1973).

[19]. Bright, L.F., Kleiser, S.B., Grau, S.L.: Too much Facebook? An exploratory examination of social media fatigue. Comput Human Behav. 44, 148–155(2015).

[20]. Fama, E.: Efficient Capital Markets: A Review of Theory and Empirical Work. J Finance. 25, 383-417(1970).

[21]. Liang, W.L.: The dilemma of information disclosure system under the implementation of science and technology innovation board and its crack. Modern Economic Discussion, 8, 125-132(2019).

[22]. Xue, S., Wang, Y.: Does the IPO review and inquiry of Science and Technology Board help pricing of new shares? --Empirical evidence from the divergent opinions of institutional investors on offline inquiry. Financial Research, 48(01), 138-153(2022).

[23]. Yang, X.L., Gao, M.: The Effect of Reliability of Information and Overconfidence on Stock Market: An Experimental Study. Southern Economy, 02, 23-40(2018).

[24]. Smith, V.L., Suchanek, G. L., Williams, A.W.: Bubbles, Crashes, and Endogenous Experiments in Experimental Spot Asset Market1. Econometrica, 56(5), 1119-1155(1988).

[25]. Yang, X.L., Jin X.J.: Research on the effectiveness of securities market information based on experimental economics approach. Journal of Zhejiang University (Humanities and Social Sciences Edition), 06, 80-88(2005).


Cite this article

Guo,Y.;Liu,Y.;Pan,Z.;Bu,G. (2023). The Impact of Information Overload on Investment Decisions under the Information Disclosure System of STAR Market. Advances in Economics, Management and Political Sciences,4,174-184.

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The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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About volume

Volume title: Proceedings of the 6th International Conference on Economic Management and Green Development (ICEMGD 2022), Part Ⅱ

ISBN:978-1-915371-17-1(Print) / 978-1-915371-18-8(Online)
Editor:Canh Thien Dang, Javier Cifuentes-Faura
Conference website: https://www.icemgd.org/
Conference date: 6 August 2022
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.4
ISSN:2754-1169(Print) / 2754-1177(Online)

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References

[1]. Huang, D.S., Wang, H.: Science and technology innovation board: a new institutional supply. Theoretical discussion. 5, 117-122 (2019).

[2]. Jia, Y.H., Ning, J.H.: Research on performance evaluation of companies to be listed on science and technology innovation board under the IPO boom. Economic System Reform. 2, 102-108(2021).

[3]. Guo, C.C., Zhang, C.: Exploration on the institutional innovation of “science and technology innovation board”. Theoretical exploration. 6, 92-98(2021).

[4]. Xi B., Zhang W. W.: Environmental information disclosure and business performance of firms--a test of mediating effects based on investors' concerns. Technology Economics, 41(05), 85-96(2022).

[5]. Li, H.X.: Information Disclosure Supervision: A Smooth and Optimized Path to Mandatory Disclosure. Chongqing Administration, 21(04), 70-72(2020).

[6]. Brown, J. S., Duguid, P. 1st ed.: The social life of information. Harvard Business School Press: Boston, United States, pp.105(2000).

[7]. Troy A.: Paredes, Blinded by the Light: Information Overload and Its Consequences for Securities Regulation. SSRN Electronic Journal (2003).

[8]. Susanna K. R.: The Dangers and Drawbacks of the Disclosure Antidote: Toward A More Substantive Approach to Securities Regulation, Baylor Law Review, 58, 1(2006).

[9]. Zhou G., Fan Q., Wang Y.D.: Information disclosure, price discrimination and crowdfunding performance. Journal of Shanxi University of Finance and Economics, 42(09), 44-57(2020).

[10]. Yang G.: Research on differentiated information disclosure of listed company. Doctor, Southwest University of Political Science and Law, China(2015).

[11]. Li D.X., Li X.D., Xiao B.Q.: Investors Experience, Reinforcement Learning and Stock Market Stability: A Survey, 01, 43-48+54(2011).

[12]. Tang, C.L., Xiang, R.J., Luo, Z.H., et al.: The impact of individual investors' sentiment on corporate social responsibility. Financial Theory and Practice, 42(06), 147-153(2021).

[13]. Xue, Z.Y., Wu, D.H.: Does information overload affect investors' use of public information-empirical evidence from quarterly surplus. Accounting Research, 6, 57-65+96(2004).

[14]. Sun L.: Research on the path of promoting the reform of stock issuance registration system. Shanghai Economic Research, 07, 16-27(2015).

[15]. Fu D., Liao Y.: Analysis of the legal adaptability of information disclosure to investors in the registration system of securities issuance. Journal of Jiangxi University of Finance and Economics, 06, 109-116(2016).

[16]. Pan C.M., Meng Z.J.: Analysis of factors influencing disclosure information overload of listed companies. Modern Trade Industry, 25(14), 17-19(2013).

[17]. Milford, J.T., Perry, R.P.: A methodological study of overload. The Journal of General Psychology, 97, 131-137(1977).

[18]. Streufert, S.C.: Effects of information relevance on decision making in complex environments. Memory & Cognition, 1(3): 224–228(1973).

[19]. Bright, L.F., Kleiser, S.B., Grau, S.L.: Too much Facebook? An exploratory examination of social media fatigue. Comput Human Behav. 44, 148–155(2015).

[20]. Fama, E.: Efficient Capital Markets: A Review of Theory and Empirical Work. J Finance. 25, 383-417(1970).

[21]. Liang, W.L.: The dilemma of information disclosure system under the implementation of science and technology innovation board and its crack. Modern Economic Discussion, 8, 125-132(2019).

[22]. Xue, S., Wang, Y.: Does the IPO review and inquiry of Science and Technology Board help pricing of new shares? --Empirical evidence from the divergent opinions of institutional investors on offline inquiry. Financial Research, 48(01), 138-153(2022).

[23]. Yang, X.L., Gao, M.: The Effect of Reliability of Information and Overconfidence on Stock Market: An Experimental Study. Southern Economy, 02, 23-40(2018).

[24]. Smith, V.L., Suchanek, G. L., Williams, A.W.: Bubbles, Crashes, and Endogenous Experiments in Experimental Spot Asset Market1. Econometrica, 56(5), 1119-1155(1988).

[25]. Yang, X.L., Jin X.J.: Research on the effectiveness of securities market information based on experimental economics approach. Journal of Zhejiang University (Humanities and Social Sciences Edition), 06, 80-88(2005).