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A Study on the Mechanism of Speculative Behaviour of "Splits" in Financial Market Firms: Based on Value-Added Theory Perspective

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DOI: 10.23977/ferm.2022.050509 | Downloads: 12 | Views: 118


Meng Chen 1


1 School of Sociology, Central China Normal University, Wuhan, 430000, China

Corresponding Author

Meng Chen


Functionalism encompasses both social structures and social action, the practical and instrumental nature of actions as well as the ideational and end-oriented nature of actions. Companies that are listed are autonomous in their decision-making regarding dividend distribution, and speculation about 'splits' is common. The "insiders" take advantage of the low level of information among the public participants in order to induce and contribute to emotional energy in the securities market, resulting in structural misconduct. The "insiders" contribute to the emotional energy of the securities market by exploiting the low information level of the public participants. As a result of "splits", market emotions, and individual profit motives and goals, the noise of splits creates cognitive or group complexity. "Splits" are the result of a combination of group or cognitive "conspiracies" that generate dependency and consistency in social action, resulting in irrational outcomes for individuals suffering from limited rationality within the market action unit. In the recent years, the SFC has cracked down on disguised "split" speculation in accordance with the law, strengthened institutional constraints, monitored system implementation, eased public distrust and conflict confrontation towards the market, and protected the rights and interests of market participants. Based on the neo-functionalist Smelser's accrual value theory, this study examines the mechanism of market participants' speculative behavior in the "splits" of listed companies in the financial market from the viewpoint of social structure, generalized emotional arousal, and socialized institutional control.


"split" hype, generalised emotional action, value-added theory


Meng Chen, A Study on the Mechanism of Speculative Behaviour of "Splits" in Financial Market Firms: Based on Value-Added Theory Perspective. Financial Engineering and Risk Management (2022) Vol. 5: 69-76. DOI:


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