Government Ownership and the Public Information Content of Insider Trading: International Evidence

Zakir Hossain, Man Duy (Marty) Pham, Sirimon Treepongkaruna, Jing Yu

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This paper investigates the political determinants of informed insider trading using an international sample of firms from 28 countries. We show that insider trading in state-owned firms (SOEs) is statistically and economically more profitable and informative than in non-state-owned firms, indicating a unique political information advantage enjoyed by these insiders. Further analysis shows that insider trading in government-owned firms becomes more profitable during nationwide periods of political uncertainty and when industry-specific government actions are introduced. Moreover, the aggregate insider trading in SOEs better predicts future stock market returns than that in non-SOEs. These results suggest that the political information advantage of SOE insiders is evident in both the idiosyncratic and macroeconomic information content of insider trading, consistent with the superior ability of these insiders to interpret the economic impact of the country-, industry-, and firm-specific government actions.
Original languageEnglish
Pages (from-to)(In-Press)
Number of pages30
JournalEuropean Accounting Review
Early online date21 Mar 2024
Publication statusE-pub ahead of print - 21 Mar 2024

Bibliographical note

This is an Open Access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives License (, which permits non-commercial re-use,distribution, and reproduction in any medium, provided the original work is properly cited, and is not altered, trans-formed, or built upon in any way. The terms on which this article has been published allow the posting of the Accepted Manuscript in a repository by the author(s) or with their consent.


This paper is based on Hossain’s dissertation at the University of Western Australia. Hossain acknowledges research funding from the Government of the Commonwealth of Australia with the Research Training Program (RTP). Treepongkaruna would like to acknowledge funding from the Australian Research Council Discovery [grant number DP130103299].


  • Informed insider trading
  • Government ownership
  • Information advantage
  • Corporate governance


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