The Relationship between Information Asymmetry and Firm Value: The Role of Financial Leverage and Growth Opportunities

Drawing on pecking order and agency cost theories, this study assesses the extent to which information asymmetry is an important determinant of firm value and the extent to which this relationship is conditional on the leverage level of firms. The study also assesses the impact of information asymmetry on firm value and on high and low growth opportunity firms the statistical population of the research include all publicly-held companies listed in Tehran stock exchange (TSE) from which 132 companies were selected as the sample and examined in the period between 2012-2017. To test the hypotheses and estimate coefficiency, the statistical "panel data" technique was employed. Based on the research results the information asymmetry adversely influences firm value, and this effect is moderated by firm's leverage but this effect does not moderated with growth opportunities.