Document Type : Research Paper
Abstract
Prior research suggests that Product market competition as an external mechanism of corporate governance roles, decrease crash risk by decreasing agency costs, aligning interests of managers and investors, decreasing malfeasance by managers, improving operations, quality financial reporting. So, The aim of this study is to investigate the effect of Product Market Competitions measures on Stock Price Crashes of listed companies in Tehran Stock Exchange. These four measures of Product Market Competition in our tests: Herfindahl-Hirschman Index (HHI), Tubin’s Q ratio, lerner and adjusted lerner index. For this purpose four hypotheses are developed and data on the 99 companies in Tehran Stock Exchange for the period of 1384 to 1394 were analyzed. This regression model using panel data with fixed effects approach, reviews and tests. The results showed that the concentration of : Herfindahl-Hirschman Index (HHI) and Tubin’s Q ratio measure of Product Market Competitions has significant positive impact and lerner and adjusted lerner index has a significant negative impact Stock Price Crashes
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