This paper evaluates the Web-based voluntary disclosure practices in a sample of 180 French listed firms.\nThe main objective is to investigate the impact of Internet-based disclosure on capital market risk. Three measures\nare used to present the capital market risk: total risk is measured by the standard deviation of stock returns, and\nsystematic risk and idiosyncratic risk are the beta and standard deviation of the residuals generated from the market\nmodel, respectively. Following the method of Gajewski and Li, the Web-based disclosure is measured by an index of\n40 items. The empirical results show that total risk and idiosyncratic risk vary inversely with the strength of Internet\ndisclosure. This indicates that improved online disclosure can reduce investors� uncertainty in the capital market.\nHowever, systematic risk is not influenced by the disclosure practice. Furthermore, capital concentration and board\nsize are negatively associated with total and idiosyncratic risk. This study extends the prior research by investigating\nthe influence of online disclosure on capital risk in the French stock market. I am particularly concerned about the\ntechnical features of Internet disclosure and its impact on capital risk. Online information is generally considered to\nbe user-friendly, yet it is now necessary to analyze the effect of this convenience provided by Internet technology on\nthe capital market.
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