National culture, information environment, and sensitivity of investment to stock prices: Evidence from emerging markets

This paper uses the data from 37 emerging markets and shows that national cultures play important role in determining sensitivity of investment to stock prices during the period between 2008 and 2014. We show that investments of firms headquartered in cultures with high power distance, high individualism, and high pragmatism (high uncertainty avoidance, high masculinity, and high indulgence) are significantly less (more) sensitive to their stock prices than that of firms headquartered in their counterpart cultures.