论文名称：Withholding Bad News in the Face of Credit Default Swap Trading: Evidence from Stock Price Crash Risk

作者：刘津宇 ; Ng, J; Tang, DY ; Zhong, R

刊名：JOURNAL OF FINANCIAL AND QUANTITATIVE ANALYSIS

发表时间：2024.03

Credit default swaps (CDSs) are a major financial innovation related to debt contracting. Because CDS markets facilitate bad news being incorporated into equity prices via cross-market information spillover, CDS availability may curb firms' information hoarding. We find that CDS trading on a firm's debt reduces the future stock price crash risk. This effect is stronger in active CDS markets, when the main lenders are CDS market dealers with securities trading subsidiaries, or when managers have more motivation to hoard information. Our findings suggest that debt market financial innovations curtail the negative equity market effects of firms withholding bad news.