Crowd Governance: The Monitoring Role of Wikipedia in the Financial Market

In this study,we explore whether Wikipedia plays a governance role in the financial market by reducing the information disadvantage of individual investors. We hypothesize that the aggregation of information on Wikipedia enables individual investors to collectively monitor insiders and institutional investors. Using the creation of a firm Wikipedia page as an information event, our empirical results support our hypothesis and further show results support our hypothesis and further show results support our hypothesis and further show that the governance effect is stronger for firms with high institutional ownership concentration as well as those with more intensive insider trading activity. Taken together, these findings support the view that Wikipedia helps mitigate the information asymmetry among individual investors, institutional investors, and corporate insiders.