Abstract

A security market in action is based on a complex social network. We can find a great majority of literature texts based on the economic rationality of financial and accounting theory. However the exploration on the interaction among members lacks social network approach. This study focuses on the social network formed by information supply and demand among main members in a security market, which includes three forms of social capital. They are information transparency, information credibility and trust. In this paper, we find significant positive relations between information transparency vs. information credibility; and information transparency vs. trust. In addition, the interactional effect of information transparency and information credibility on trust is also significantly positive. There are some important implications on these findings. First, a firm should strengthen the transparency of information in order to build an advantage position for equity financing. Second, when the policy of information disclosure matches definitely with embedding position; then, a leverage effect of information transparency would occur.