The Empirical Research On Effect Of Information Disclosure Transparency Of Listed Companies On The Cost Of Equity Capital

Capital market is a market full of flow information and flow capital.As a link oftransaction of capital markt, the transparency level of information directly affects boththe effectiveness of the capital market and the optimal allocation of resources.In China,the listed companies, on the one hand keen on equity financing, on the other hand, theyhave few voluntary on disclosing information, If want to raise the voluntaryinformation disclosure of listed companies we should let them see the benefits ofinformation disclosure.Previous studies of Western countries showed that the improvetransparency of information disclosure can alleviate information asymmetry of capitalmarkets, improve stock liquidity, reducing investor risk prediction, thereby reducingthe cost of equity capital of listed companies. However, this study was woked out in adeveloped stock market, whether it is available in China stock market, which is anemerging stock market, still remains to be established.This article briefly describes the research background and researchmeaning,research status at home and abroad, the disclosure of informationtransparency and rights related concept and measure of the cost of capital(measurement) method, and the transparency of information disclosure of listedcompanies with equity capital cost are analyzed in theory, the relationship between asthe research hypothesis is put forward to provide theoretical basis. In the empiricalpart,based on the studies of the relationship between transparency of informationdisclosure and the cost of equity capital by Western scholars,We use the data ofA-share listed companies that were listed on Shenzhen main board market in ourcountry,calculate the cost of the equity capital of listed companies by the residualincome discount model, select the information disclosure quality of listed companiesas alternative index of the listed companies’ information disclosure transparency, selectthe overall information disclosure quality of listed companies and the earningsinformation disclosure quality of listed companies to measure the informationdisclosure quality of listed companies, among them, the earnings informationdisclosure quality is measured by earnings aggressiveness and earnings smoothnesss. The result of empirical study show that the overall qualitinformation of disclosurequality of listed companies does not significantly correct with the equity capital cost;the disclosure quality of earnings information of listed companies is negativel relatedto the equity capital cost.