| Summary: | 碩士 === 國立高雄第一科技大學 === 財務管理研究所 === 103 === This study investigateshow media coverage(total number of newspaper articles per covered firm)affects the corporate credit risk (measured by TCRI index) by using TWSE-listed firms during 1996-2013.Previous literature suggests thatmass media plays a governance role of external monitoring mechanism. Besides, other studies suggest that good governance reduces the information asymmetry between the outside investors and management and thus reduces the agency problem. Taken together, this paper hypothesizes that firms with higher (lower) media coverage experience a lower (higher) corporate credit risk through an improvement in corporate governance. Evidently, our empirical findings support the hypothesis. Furthermore, we also find that the effect of media coverage on corporate credit risk is more observable for poor-governed firms and loss firms, suggesting that media coverage exhibits a substitute or a supplement to traditional mechanism of corporate governance.
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