Speaker: 石芸，华东师范大学

Title: The Real Cost of Readability: Market and Real Efficiency in the Age of Machine Reading

Language: Chinese

Time & Venue: 2024.12.02 09:30-11:00 思源楼415

Abstract: As machines increasingly process financial reports, financial filings are becoming more machine-readable. This paper examines how machine-readable financial reporting affects price efficiency by constructing a machine readability index, and establishes causality using instrumental variable and discontinuity-based difference-in-differences tests. While machine readability strengthens market efficiency by broadening coverage, reducing cognitive bias, and enhancing computational power, it negatively impacts real efficiency. Specifically, it benefits fixed investments but hinders R&D, improving real efficiency in value firms while reducing it in growth firms. The shift in the informational composition of prices aligns with these findings, highlighting a trade-off between market and real efficiency.