How Does Social Media Influence Financial Fraud in Publicly Listed Companies?
With the rise of social media,its impact on the financial transparency of publicly listed companies has received increasing attention.This study investi-gates how social media,particularly posting activity on East Money's stock message boards,affects the financial fraud behavior of listed companies.Utilizing data from East Money's stock message boards and a bivariate probit regression model,the study finds that the number of posts on the message boards is inversely related to the proba-bility of fraud occurrence and positively related to the probability of fraud detection.This finding indicates that social media may play a dual role in both deterring fi-nancial fraud and uncovering it.To address endogeneity issues,the study employs an instrumental variable approach.Additionally,based on the"fraud triangle"the-ory,the paper proposes and validates two mechanisms through which message board posting activity reduces the likelihood of financial fraud:By decreasing potential op-portunities for fraud and increasing the difficulty of rationalizing fraud.Heterogeneity analysis reveals that negative posts and posts by senior users are more effective in curbing financial fraud.This research not only enhances the understanding of how social media can function in corporate governance but also provides insights for reg-ulatory authorities on leveraging social media for financial supervision.
social mediastock message boardsfinancial fraudcorporate gover-nance
万方数据
维普
