Does Media Attention Definitely Have Good Effect?

In this dissertation,author uses collected data on media's behavior reports number on listed company and studies media attention's influence upon listed company performance,market reaction and company governance in the research perspective of listed company cash dividend allocation.Under the background of information age,due to function of information delivery,public opinion guidance and image form,media has gradually become the important message media between company and social investors.Media supervision is also considered as one important system arrangement to replace the insufficient legal protection and has gained broad attention due to the important role in capital market.In the summary on corporate governance,Gillan(2006)points out that media have viewed as an important external governance mechanism coordinate with law and has significant research meaning.The high or low of media information quality,the profession of media and comprehensive understanding on enterprise need our attention more.Behavioral finance regards media as the chief culprit of the irrational behavior of triggering capitalistic market.Media's entertainment quality and its pursuit towards sensational effect make the reporting content shallow and have non-professional trending report,even release unreal report for catching eyes.Media's “biasness” makes its governance impact hard to function.Media bias theory thinks that in order to pursue the maximum effect,media naturally has the tendency to guide entertainment or pursue sensational effect,and the news reported in this condition may deviate from truth and mislead investors and other information users.Mullainathan and Shleifer(2002)divide the biasness of media into two types: biasness caused by ideology and biasness caused by pursuing sensational effect.Media's report also has the tendency of reporter and extremely restricted by professional knowledge and comprehensive understanding on company's financial status.But with the gradual progressing of marketization of securities market,media have to face fiercer market competition day by day.In order to survive and develop in competition,all media must try to improve news' market value,namely report more about hot news and star companies of market attention.In this circumstance,media reporting securities market news shall have different levels in the two types of biasness.With the development of capital market,media's influence is recognized more and more by theory field and practical field.The current studies find out that media's report on listed company would cause the redistribution of information,and places listed company in the spotlight of company and trigger more interest persons' attention.Because media governance eventually influences upon listed company,the truth and profession of report and total understanding on company's financial status are extremely necessary.If not,due to relevant supervision department,investor is an important information user and the administrative intervention of related supervision department would directly influence listed company.From the perspective of dividend allocation,enterprise receiving large amount of negative reports must choose to release more cash dividends in order to decrease reputation loss and supervision cost.Is it good to release more cash dividends? Is it good for company and market's long-term development? Will it bring “irrational” cash dividends releasing policy? Media attention on listed companies which release overly is low and cannot play the supervision role on their behavior.It has failure of media governance.First of all,on the basis of sorting out bias media report theory,behavioral finance's dividend allocation theory and agenda setting theory in communication,this essay adopts combined method of descriptive statistics and empirical testing and applies statistical data to conduct systematic research on biased media governance's efficiency.This essay chooses media's data on listed company reports from 2010 to 2014 and analyzes media report amount and media report strength's influence on cash dividend policy to get their influence upon listed company investment efficiency and stock price so as to make the verification of efficiency of media governance.On one hand,it provides theoretical reference for relevant supervision department making dividend policy.On the other hand,through empirical test,media attention would not play positive role.The profession and comprehensiveness of media report is the key for improving media governance efficiency.The empirical part of this essay studies relationship between media attention,listed company's cash dividend allocation,investment efficiency and stock price reflection.The chapters of this essay are as follows:Chapter One introduces the research issue,research content,essay framework,research contribution and innovationChapter Two makes review on the development history and evolving direction of literature on dividend allocation theory and analyzes dividend allocation issue.Then it makes review on dividend catering theory literature and reviews our country's irrational dividend allocation status.It then centers round media's corporate governance influence and media report biased phenomenon theory and experience evidence to develop systematic review.Chapter Three introduces media supervision and media biased theory,dividend catering theory,agent theory,and investment efficiency theory.Based upon this,analyzes the negative influence upon media governance,reviews the difference “rational” dividend policy and “irrational” dividend policy and uses traditional media governance theory to deduce the relationship mechanism between media attention and “irrational” dividend policy.Chapter Four is the analysis of the current situation of dividend distribution of listed companies in our country.Chapter Five in order to relieve the intervention from the changes of dividend supervision policy,this essay chooses sample from 2010 to 2014 to study upon the relationship between media attention and listed company's cash dividend allocation policy.The result shows that media attention is able to improve the probability of listed company releasing cash dividend and this result is not caused by the last year's dividend releasing.Meanwhile,the influence of media attention is more obvious in listed company sample without financing needs,which means media attention and restriction on dividend controlling policy represent replaced relationship.In addition,influence of media attention would be influenced by the voice of the first shareholder.The bigger the voice of the first shareholder is,the less the listed company's attention on the media's attention on company behavior and dividend policy is,representing the arrogant action.From the sample result,if the first shareholder owns sufficient control right,it would restrict the influence of media attention as non-official governance mechanism.Chapter Six,on the basis of media attention improving listed company's possibility of releasing cash dividend,this chapter makes subdivision on the listed company and studies whether the media attention has positive correcting role or not.Is it a rational governance mechanism just as people mentioned? Through aggression analysis on listed company sample by dividing into state-owned group,on-state-owned group,normal allocation dividend group,excessive allocation dividend group and non-releasing group with capability and get the final conclusion.As a whole,media attention has supervision influence.But from the perspective of dividend allocation,it does not play the real governance and correcting role.Regarding state-owned enterprise,excessive releasing enterprise,no dividend enterprise with capability,they do not play the correcting governance role.Through grouping testing,media attention does not have governance role and has the possible of governance failure on the controlled enterprise group.Regarding irrational dividend enterprise,it has no correcting role on their incorrect behavior.In Chapter Seven,we continue to verify the governance of media attention and verify media's governance effect through listed company's internal investment efficiency and stock price.The result shows that it does not play the correcting role for the healthy development of market at large extent.We further proved that media attention only has supervisio n influence upon listed company with relatively sufficient free cash flow and normal allocation dividend.In the media attention,company with sufficient allocation cash dividend does not decrease excessive investment behavior due to the influence of media attention.Listed company with insufficient funds caters market due to media attention and releases dividend to aggravate the possibility of insufficient investment.Therefore,in media attention,enterprise controller releases dividend in order to cater this mechanism,which is not good for enterprise's future development.From the market reaction,we observe the accumulated profits 7 days before and after company releases cash dividend.Stock price does not increase due to the releasing of cash dividend but has the decreasing tendency.Thus this essay has the reason to get the conclusion that from the perspective of media attention,media attention not always has good influence and has irrational behavior.Chapter Eight combines the research result of this essay and gets the major conclusion and policy suggestions and proposes future research direction.