Confucianism And Stock Price Synchronization

This paper empirically examines the effect of Confucian culture on stock price synchronization by selecting data from listed companies from 2008-2021. The results show that Confucian culture can significantly reduce the level of stock price synchronization and does so mainly by suppressing managers' self-interested motives and improving the quality of corporate information. Heterogeneity analysis reveals that the inhibitory effect of Confucian culture on stock price synchronization is more pronounced in firms that have not been exposed to foreign cultural shocks and have less analyst attention. The findings provide empirical evidence to support the governance function of Confucian culture and have important practical implications for improving capital market pricing efficiency.