Business Strategy and Intra-Industry Information Transfers

Citation data:

Accounting and Finance Research, ISSN: 1927-5986, Vol: 6, Issue: 3, Page: 1

Publication Year:
2017
Captures 2
Readers 2
Repository URL:
https://digitalcommons.mtu.edu/business-fp/404
DOI:
10.5430/afr.v6n3p1
Author(s):
Guo, Peng
Publisher(s):
Sciedu Press
Tags:
Business
article description
This study examines whether business strategy affects information transfers from one firm to its industry peers. I use Miles and Snow’s (1978, 2003) organizational typology to classify firms along a continuum with innovative ‘prospector’ firms at one end and stable low-growth ‘defender’ firms at the other. When a firm announces its earnings, the information transfer to other peer firms in the same industry is weaker (stronger) when the announcing firm is a prospector (defender). In addition, information transfers from the announcing firm to industry peers are weaker (stronger) when the industry peer is a prospector (defender). Taken together, the evidence in this paper suggests that firms’ business strategies affect the strength of information transfers.