AUTHOR=Su Mimi , Wang Chen 

TITLE=Policy Announcement, Investor Attention, and Stock Volatility: Evidence From the New Energy Vehicle Industry

JOURNAL=Frontiers in Psychology

VOLUME=Volume 13 - 2022

YEAR=2022

URL=https://www.frontiersin.org/journals/psychology/articles/10.3389/fpsyg.2022.838588

DOI=10.3389/fpsyg.2022.838588

ISSN=1664-1078

ABSTRACT=New energy vehicle policies have greatly promoted the growth of the new energy vehicle industry in China, while also attracting a lot of investor attention. Using Chinese new energy vehicle concept stocks and related industrial policies, including purchase tax incentives (PTI) and promotion & application (P&A) policies, issued from 2011 to 2020 as the research setting, this paper adopts a panel data model to examine the impact of policy announcement on the volatility of new energy vehicle concept stocks, as well as the mediating role of investor attention in transmitting the impact. We find that new energy vehicle P&A policies have a significant and positive impact on new energy vehicle concept stock volatility, while PTI policies do not have a significant impact. Moreover, investor attention plays a partial mediating role in transmitting the impact of P&A policies on new energy vehicle stock market by increasing the stock volatility risk. Furthermore, there is heterogeneous effect of equity ownership in the relationship between policy announcement and investor attention on the volatility of new energy vehicle concept stocks; non-state-owned firms are more sensitive to the new energy vehicle P&A policies than state-owned firms. By analyzing the relationship between policy announcement and concept stock volatility, this paper enriches the research on new energy vehicle concept stocks and provides policy implications for the new energy vehicle industry.