Does Firms’ Rhetorical Nationalism Obscure Stock Price Informativeness? Evidence from Chinese Listed Firms

Research in International Business and Finance. 2026. Vol. 81. Article 103205.

Jin T., Wang J., Wu Y.

Leveraging information asymmetry theory, this study investigates whether rhetorical nationalism in corporate disclosures diminishes firm-specific price informativeness. Analyzing Chinese A-share data from 2010 to 2022, we develop a text-based index of rhetorical nationalism and find that firms employing stronger rhetoric exhibit greater stock price synchronicity. Forward-looking evidence supports an information environment channel: heightened rhetoric is associated with reduced linguistic specificity, increased analyst earnings forecast bias, and fewer negative media reports in the subsequent year, suggesting greater opacity and weaker firm-specific signals. This effect is amplified under stronger political intervention, higher tax incentives, and vaguer disclosure language. Economic consequence tests reveal that rhetorical nationalism undermines long-term firm value by distorting capital market information efficiency. Overall, our findings provide novel insights into the economic implications of political narratives in stock markets, offering a theoretical basis for regulators to refine guidelines for institutional investors and mitigate noise-driven trading in emerging markets.

Keywords: информационная асимметрия, information asymmetry, Rhetorical Nationalism, Stock Price Synchronicity, Риторический национализм, Синхронность цен на акции

Publication based on the results of: Institutions, human capital and regional Development: historical analysis and contemporary challenges (2025)