Advertising and Asymmetric Information : Evidences from Brazilian Stock Market

This research demonstrates that it is possible for investors to anticipate the effects of advertising campaigns. It examined the long-term relationship between advertising and asymmetric information based on the theories of value creation through advertising and market microstructure. We assume that asymmetric information and advertising have a positive and significant relationship. Data from corporations listed on a developing stock market for 57 quarters were analyzed. Advertising was defined as the relationship between selling expenses, and asymmetric information according to the Corwin-Schultz S_2 measure. The results were controlled for traditional determinants of finance. A long-term relationship was observed between advertising and asymmetric information, thus confirming the theoretical framework. The implications are related to the anticipation of short-and long-term effects resulting from advertising through asymmetric information and cointegration to study the phenomena of the marketing-finance interface; restrictions are related to the coverage of the sample.