Short-termism in Euronext Lisbon : an empirical analysis
Autor(a) principal: | |
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Data de Publicação: | 2016 |
Outros Autores: | |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
Texto Completo: | http://hdl.handle.net/10400.5/14396 |
Resumo: | For several years, there has been an ongoing debate about one inefficiency of markets, namely, stock market myopic behavior or stock market short-termism. This inefficiency is described as being a situation where investors overvalue short-term earnings and undervalue long-term earnings. This study examines whether the Portuguese stock market exhibits such preference for short-term earnings for the period between 2000 and 2008, using the Abarbanell and Bernard (2000) accounting-based valuation model, which generates predictions about how prices should relate to book value, as well as expected short-term and long-term earnings. Empirical analysis is not conclusive. In fact the evidence collected for this period based on Abarbanell and Bernard’s (2000) cross-section analysis favours market efficiency and therefore we reject the claim of market myopia. According to this result, the Portuguese stock market assigns the same weight for all the value components of listed companies. Based on an innovative panel data analysis, we collected evidence on which market assumes a particular form of short-termism, as investors value efficiently book value and short-term earnings, but undervalue long-term earnings. This paper contributes with quantitative evidence for the rising public policy debate regarding the scale of short-termism in capital markets. |
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Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
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7160 |
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Short-termism in Euronext Lisbon : an empirical analysisMarket myopiaMarket efficiencyBook valueAbnormal earningsshort termismEuronext LisbonPortugalFor several years, there has been an ongoing debate about one inefficiency of markets, namely, stock market myopic behavior or stock market short-termism. This inefficiency is described as being a situation where investors overvalue short-term earnings and undervalue long-term earnings. This study examines whether the Portuguese stock market exhibits such preference for short-term earnings for the period between 2000 and 2008, using the Abarbanell and Bernard (2000) accounting-based valuation model, which generates predictions about how prices should relate to book value, as well as expected short-term and long-term earnings. Empirical analysis is not conclusive. In fact the evidence collected for this period based on Abarbanell and Bernard’s (2000) cross-section analysis favours market efficiency and therefore we reject the claim of market myopia. According to this result, the Portuguese stock market assigns the same weight for all the value components of listed companies. Based on an innovative panel data analysis, we collected evidence on which market assumes a particular form of short-termism, as investors value efficiently book value and short-term earnings, but undervalue long-term earnings. This paper contributes with quantitative evidence for the rising public policy debate regarding the scale of short-termism in capital markets.ISEG - Departamento de GestãoRepositório da Universidade de LisboaMatos, Pedro VergaCoelho, Miguel2017-12-06T09:40:46Z20162016-01-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10400.5/14396engMatos, Pedro Verga e Miguel Coelho (2016). "Short-termism in Euronext Lisbon : an empirical analysis". European Journal of Management Studies, 21(1):49-752183-4172info:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-03-06T14:44:27Zoai:www.repository.utl.pt:10400.5/14396Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T17:00:14.035611Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse |
dc.title.none.fl_str_mv |
Short-termism in Euronext Lisbon : an empirical analysis |
title |
Short-termism in Euronext Lisbon : an empirical analysis |
spellingShingle |
Short-termism in Euronext Lisbon : an empirical analysis Matos, Pedro Verga Market myopia Market efficiency Book value Abnormal earnings short termism Euronext Lisbon Portugal |
title_short |
Short-termism in Euronext Lisbon : an empirical analysis |
title_full |
Short-termism in Euronext Lisbon : an empirical analysis |
title_fullStr |
Short-termism in Euronext Lisbon : an empirical analysis |
title_full_unstemmed |
Short-termism in Euronext Lisbon : an empirical analysis |
title_sort |
Short-termism in Euronext Lisbon : an empirical analysis |
author |
Matos, Pedro Verga |
author_facet |
Matos, Pedro Verga Coelho, Miguel |
author_role |
author |
author2 |
Coelho, Miguel |
author2_role |
author |
dc.contributor.none.fl_str_mv |
Repositório da Universidade de Lisboa |
dc.contributor.author.fl_str_mv |
Matos, Pedro Verga Coelho, Miguel |
dc.subject.por.fl_str_mv |
Market myopia Market efficiency Book value Abnormal earnings short termism Euronext Lisbon Portugal |
topic |
Market myopia Market efficiency Book value Abnormal earnings short termism Euronext Lisbon Portugal |
description |
For several years, there has been an ongoing debate about one inefficiency of markets, namely, stock market myopic behavior or stock market short-termism. This inefficiency is described as being a situation where investors overvalue short-term earnings and undervalue long-term earnings. This study examines whether the Portuguese stock market exhibits such preference for short-term earnings for the period between 2000 and 2008, using the Abarbanell and Bernard (2000) accounting-based valuation model, which generates predictions about how prices should relate to book value, as well as expected short-term and long-term earnings. Empirical analysis is not conclusive. In fact the evidence collected for this period based on Abarbanell and Bernard’s (2000) cross-section analysis favours market efficiency and therefore we reject the claim of market myopia. According to this result, the Portuguese stock market assigns the same weight for all the value components of listed companies. Based on an innovative panel data analysis, we collected evidence on which market assumes a particular form of short-termism, as investors value efficiently book value and short-term earnings, but undervalue long-term earnings. This paper contributes with quantitative evidence for the rising public policy debate regarding the scale of short-termism in capital markets. |
publishDate |
2016 |
dc.date.none.fl_str_mv |
2016 2016-01-01T00:00:00Z 2017-12-06T09:40:46Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10400.5/14396 |
url |
http://hdl.handle.net/10400.5/14396 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
Matos, Pedro Verga e Miguel Coelho (2016). "Short-termism in Euronext Lisbon : an empirical analysis". European Journal of Management Studies, 21(1):49-75 2183-4172 |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.format.none.fl_str_mv |
application/pdf |
dc.publisher.none.fl_str_mv |
ISEG - Departamento de Gestão |
publisher.none.fl_str_mv |
ISEG - Departamento de Gestão |
dc.source.none.fl_str_mv |
reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação instacron:RCAAP |
instname_str |
Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
instacron_str |
RCAAP |
institution |
RCAAP |
reponame_str |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
collection |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
repository.name.fl_str_mv |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
repository.mail.fl_str_mv |
|
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1799131089530257408 |