The Effects of Analyst‐Country Institutions on Biased Research: Evidence from Target Prices
研究发现，分析师所在国的制度基础设施越强，其目标价预测的乐观偏差越小，目标价的价值相关性越高，表明国内制度能抑制跨境活动中的自利行为。
ABSTRACT Prior research demonstrates that a strong institutional infrastructure in a country moderates self‐serving behavior of market participants. Cross‐country economic activities have increased significantly, presenting a research opportunity to examine the relative influence of local versus foreign institutional infrastructure on individual market participants. We utilize variation in analyst‐country location relative to covered firm location to examine institutional determinants of optimism in analyst research. Focusing on target prices, where persistent optimism is well documented, we find that analysts domiciled in countries with stronger institutional infrastructures exhibit significantly attenuated target price optimism and more value‐relevant target prices. Our results demonstrate the importance of domestic country‐level institutional factors in moderating self‐serving behavior of market participants engaged in cross‐country activities.