The effect of Culture Elements on Stock Price Crash and Jump Risk

Subject Areas : Journal of Cultural Management

Ghader Dadashzadeh ¹ , Yunes Badavarnahandi ²

1 - Ph.D Student in Accounting, Marand Branch, Islamic Azad University, Marand, Iran E-mail: [e-mail]
2 - Associate Professor, Department of Accounting, Tabriz Branch, Islamic Azad University, Tabriz, Iran (Corresponding Author): [e-mail]

Received: 2017-10-03 Accepted : 2018-01-22 Published : 2017-05-22

Keywords: Stock Price Jump Risk, Stock Price Crash Risk, Culture Elements,

Abstract :

Introduction and Purpose of the Research: One of the issues related to the behavior of stock price is the sudden changes is that it occurs as a crash or jump in stock price and it faces a huge challenge to investing in stocks. Studies have shown that the emergence of such events in the market is rooted in the culture of societies and by classifying culture into two types of secrecy and transparency leap to link stock price crash and jump and to cultural values. Accordingly, the purpose of this study is to investigate the effect of cultural elements on stock price crash and jump risk. Research Method: For this purpose, through the Hofstede Cultural Element Questionnaire (1980), information about the cultural elements was gathered of the companies accepted in the Tehran Stock Exchange. The present research is applied in terms of purpose and in terms of nature, descriptive-survey. Findings: The results of this research showed non effect Power Distance,Individualism versus Collectivism and Masculinity versus Femininity on stock price crash risk and Uncertainty Avoidanceis negative and significant effect on stock price crash risk. Also, cultural elements non effect on stock price jump risk. Conclusion: Cultural values are considered as an unknown factor among shareholders, managers and other stakeholders in assessing the Stock Price Crash and Jump Risk