Date of Award
5-31-2026
Document Type
Campus Access Dissertation
Degree Name
Doctor of Philosophy (PhD)
Department
Finance
First Advisor
Atreya Chakraborty & Lucia Silva Gao
Second Advisor
Chi wan
Third Advisor
Maureen Scully
Abstract
This dissertation examines how information asymmetry shapes disclosure, firm behavior, and consumer outcomes in financial markets. Across three empirical essays, it studies how latent risks are communicated, acted upon, and monitored, with a focus on climate regulatory risk and the role of external information intermediaries. The first essay develops a forward-looking measure of firms’ expected exposure to climate regulation and examines how this exposure influences corporate disclosure and asset prices. The results show that regulatory risk is priced by financial markets beyond voluntary disclosure, highlighting the role of estimation uncertainty and belief formation. The second essay studies firms’ real responses to regulatory risk, focusing on corporate innovation as a costly and credible signal of private beliefs about future regulatory constraints. Firms facing greater regulatory exposure increase innovative activity, particularly in environmentally relevant technologies, indicating that innovation functions both as adaptation and signaling. The third essay examines the role of the external information environment using local newspaper closures as an exogenous shock to media monitoring. The results show that newspaper closures lead to persistent declines in financial service quality, reflected in increased consumer complaints and greater firm remediation. Together, the essays demonstrate that information asymmetry operates through multiple channels, including disclosure, real actions, and external monitoring, and have implications for investors, regulators, and consumer financial protection
Recommended Citation
Patel, Poojan, "Essays on Large Language Models, Information Asymmetry and Decision Making" (2026). Graduate Doctoral Dissertations. 1155.
https://scholarworks.umb.edu/doctoral_dissertations/1155
Comments
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