DOES INCOME SMOOTHING AFFECT STOCK MARKET PRICE VOLATILITY? AN EMPIRICAL STUDY.

This study investigates the association between income smoothing and stock market price volatility of non-financial firms listed on Amman Stock Exchange (ASE) for the period extending from 2011 to 2017. Utilizing a sample of firms listed on the ASE and controlling for four variables (firm sector, size, profitability, financial leverage, and trading volume), the results indicated that there is no significant relationship between the firm's income smoothing and stock market price volatility. The results also indicated that firm size is the only variable with significant association with volatility, where larger firms have less volatile stock price than smaller ones. [ABSTRACT FROM AUTHOR]