انحصار بین المللی و ارتباط بازار سهام : مورد خطوط هوایی جهانی

This paper investigates the effect of oligopolistic rivalry on spillovers in financial reporting. Using an event study methodology and focusing on global airlines, we find that firms experience discernable abnormal stock price reactions at the announcement of unexpected earnings by rival airlines. The extent of the price reactions is related to the extent of rivalry between the announcing and non-announcing firms, among other factors. Our empirical evidence, which is inconsistent with the contestable markets hypothesis, confirms an association between the stock market performance of players in a global industry and the extent of inter-firm rivalry in the product market.

Growing globalization has resulted in increasing interdependencies among national economies. Concomitant with this rising interdependence has been an increase in the flow of financial information across national borders and a growing integration of capital markets (Firth, 1996). Such interdependence tends to create linkages in stock market returns and corporate profitability across national borders, which may be expected to be most notable among global industries. Air transport has been well known as a global industry, but one served primarily by national firms (Hanlon, 1999). As a catalyst and a facilitator of various cross-border economic activities, air transport has played and will continue to play a critical role for speeding up globalization. However, despite gradual liberalization in recent years, the ability of global airlines to conduct their business in much the same way as global firms in other transnational industries is inhibited by governmental restrictions on foreign ownership and anti-competitive bilateral air services agreements between countries (Hanlon, 1999 and Rhoades, 2003). It is thus unclear whether, and to what extent, linkages in the product market result in linkages in the stock market performance of global airlines. The purpose of this paper is to add to the literature on international financial market linkages and equity pricing by examining the existence and determinants of transnational information transfer associated with earnings releases by global airlines. Evidence of such transfer is consistent with an efficient, integrated world capital market, at least for certain global industries. The need for, and urgency of, a move towards global harmonization of accounting and reporting standards is reduced if there is evidence that investors and financial analysts are able to interpret and extrapolate profit numbers calculated under different national accounting rules for the revaluation of shares (Firth, 1996). The existence of transnational information transfers also has implications for the contestable markets hypothesis, for research design issues in capital market studies involving global industries, and for the formulation of practical investment strategies. Section 2 discusses related information transfer studies and some key characteristics of the global airline industry. Section 3 presents the research design and the hypotheses. Section 4 presents the results and relevant discussions. Finally, a summary and conclusions are presented in Section 5.

This paper confirms the existence of transnational information transfers associated with earnings announcements for an identifiable subset of firms; notably, close competitors. The existence of such transfers has several implications. First, it provides evidence to suggest that in a highly transnational industry as exemplified by global airlines, inter-firm rivalry induces stock market linkages across national borders, with such firm-level interactions being stronger for close competitors (i.e. those with high inter-firm rivalry). Such evidence is not supportive of the contestable markets hypothesis in an international setting, a result that is not surprising given the nature of competition among global airlines. Second, at least for certain global industries, the current national differences in financial reporting standards are not so insurmountable as to inhibit investors from extrapolating foreign earnings information for use in the continuous and timely revaluation of domestic firms. The existence of transnational information transfers might also be responsible, at least in part, for earlier findings of weak information content of earnings releases by global airlines. To the extent that transnational information transfer exists for firms that compete closely in the international product market, future capital market studies may need to take such interactions into account. Future studies may also extend the current study by focusing on either dedicated cargo carriers or combination carriers, both of which groups may display similar or dissimilar characteristics as the sample documented and analyzed here.