Investigation of herding behavior in developed and developing countries: Does country governance factor matters?
Although numerous studies have been conducted on herding behaviours, only a limited number has focused on the governance factor that may influence herding activity. This paper examines whether countries’ governance influences herding decisions among investors. Applying the cross-sectional absolu...
| Main Authors: | , , , |
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| Format: | Proceeding Paper |
| Language: | English |
| Published: |
Universiti Tunku Abdul Rahman,
2017
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/57831/ http://irep.iium.edu.my/57831/13/57831_Investigation%20of%20Herding%20Behavior_complete.pdf |
| _version_ | 1848785004284346368 |
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| author | Mohd Nasarudin, Ahmad Fawwaz Noordin, Bany Ariffin Amin Law, Siong Hook Yahya, Mohd Hisham |
| author_facet | Mohd Nasarudin, Ahmad Fawwaz Noordin, Bany Ariffin Amin Law, Siong Hook Yahya, Mohd Hisham |
| author_sort | Mohd Nasarudin, Ahmad Fawwaz |
| building | IIUM Repository |
| collection | Online Access |
| description | Although numerous studies have been conducted on herding
behaviours, only a limited number has focused on the governance factor that
may influence herding activity. This paper examines whether countries’
governance influences herding decisions among investors. Applying the
cross-sectional absolute deviation (CSAD) method on data from 60 countries,
the results on herding estimation based on the country level segmented into
three panels reveal that the strict governance would help to minimize herding
activity. Among countries with strict governance, only six report herding
activity. However, the results show that herding activity is reported more
often in countries with moderate or weak governance. Our results also
suggest that herding activity will be practiced more in the country where the
information dissemination is less efficient due to its less-strict governance
level. |
| first_indexed | 2025-11-14T16:46:15Z |
| format | Proceeding Paper |
| id | iium-57831 |
| institution | International Islamic University Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T16:46:15Z |
| publishDate | 2017 |
| publisher | Universiti Tunku Abdul Rahman, |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | iium-578312018-03-01T05:42:08Z http://irep.iium.edu.my/57831/ Investigation of herding behavior in developed and developing countries: Does country governance factor matters? Mohd Nasarudin, Ahmad Fawwaz Noordin, Bany Ariffin Amin Law, Siong Hook Yahya, Mohd Hisham HG4501 Stocks, investment, speculation Although numerous studies have been conducted on herding behaviours, only a limited number has focused on the governance factor that may influence herding activity. This paper examines whether countries’ governance influences herding decisions among investors. Applying the cross-sectional absolute deviation (CSAD) method on data from 60 countries, the results on herding estimation based on the country level segmented into three panels reveal that the strict governance would help to minimize herding activity. Among countries with strict governance, only six report herding activity. However, the results show that herding activity is reported more often in countries with moderate or weak governance. Our results also suggest that herding activity will be practiced more in the country where the information dissemination is less efficient due to its less-strict governance level. Universiti Tunku Abdul Rahman, 2017-05 Proceeding Paper PeerReviewed application/pdf en http://irep.iium.edu.my/57831/13/57831_Investigation%20of%20Herding%20Behavior_complete.pdf Mohd Nasarudin, Ahmad Fawwaz and Noordin, Bany Ariffin Amin and Law, Siong Hook and Yahya, Mohd Hisham (2017) Investigation of herding behavior in developed and developing countries: Does country governance factor matters? In: The 19th Malaysian Finance Association Conference (MFAC) 2017 : Challenges and New Directions amidst Global Financial Uncertainty, 16th - 18th May 2017, 16-18 MAY 2017, Universiti Tunku Abdul Rahman Kampar. (Unpublished) http://www.mfa.com.my/current-issue/ |
| spellingShingle | HG4501 Stocks, investment, speculation Mohd Nasarudin, Ahmad Fawwaz Noordin, Bany Ariffin Amin Law, Siong Hook Yahya, Mohd Hisham Investigation of herding behavior in developed and developing countries: Does country governance factor matters? |
| title | Investigation of herding behavior in developed and developing countries: Does country governance factor matters? |
| title_full | Investigation of herding behavior in developed and developing countries: Does country governance factor matters? |
| title_fullStr | Investigation of herding behavior in developed and developing countries: Does country governance factor matters? |
| title_full_unstemmed | Investigation of herding behavior in developed and developing countries: Does country governance factor matters? |
| title_short | Investigation of herding behavior in developed and developing countries: Does country governance factor matters? |
| title_sort | investigation of herding behavior in developed and developing countries: does country governance factor matters? |
| topic | HG4501 Stocks, investment, speculation |
| url | http://irep.iium.edu.my/57831/ http://irep.iium.edu.my/57831/ http://irep.iium.edu.my/57831/13/57831_Investigation%20of%20Herding%20Behavior_complete.pdf |