YEN CHENG CHANGHarrison G. HongLarissa TiedensNa WangBin Zhao2019-07-242019-07-242015-01https://ssrn.com/abstract=2373097https://scholars.lib.ntu.edu.tw/handle/123456789/414957Stanford University Graduate School of Business Research Paper No. 13-16. --AEA (Boston), WFA (Monterey Bay), EFA (Lugano), NBER Chinese Economy, CICF (Shanghai), FMA (Nashville), FMA Asia (Tokyo) --Best Paper Award, SFM (Kaohsiung, Taiwan)Diversity of opinions among investors plays a crucial role in models of financial market speculation and bubbles. Yet, little is known about the origins of investor disagreement. Using unique data from China, we identify an important cultural and linguistic factor. We show that investors living in linguistically diverse areas express more diverse opinions on stock message boards and trade stocks more actively. We use geographical isolation of an area due to hilly terrain as an instrument for linguistic diversity. We then discriminate in favor of a differential interpretations mechanism and against slow news diffusion due to language barriers.conference paper