‘Socio-Legal Research and Insider Trading in Australia’ — A Rejoinder
| Published date | 01 August 1997 |
| Author | Gillian Dempsey |
| Date | 01 August 1997 |
| DOI | 10.1177/000486589703000206 |
| Subject Matter | Articles |
'Socio-Legal Research and Insider
Trading
in
Australia'
- A
Rejoinder
Gil/ian Dempsey"
Introduction
In his comment (Tomasic 1996) on my article in the December 1996 issue of
this journal (Dempsey 1996) Tomasic raises a number of concerns. My
original article was critical of some elements of an insider trading research
project in which Tomasic was aprincipal investigator. The following is a brief
summary of his major concerns. First, my description of elements
of
the
insider trading study (Tomasic &Pentony 1990) as 'quantitative' is rejected.
Secondly, issue is taken with suggestions that researcher and/or interviewee
value judgments may have influenced responses and their interpretation.
Thirdly, the use
of
media publicity as an element of the research process is
defended. Fourthly, the process of inference from the interview responses is
defended.
In general, the reply by Tomasic is surprising and disappointing,
particularly in a range of statements which attribute 'emotional' and
'antagonistic' qualities to the original paper. There is little, however, to be
gained from revisiting some issues and it is best left to readers to judge these
arguments for themselves. The following responses are made in further
discussion
of
the key issues and in defence of my initial criticisms.
The quantitative issue
Tomasic describes the characterisation
of
the extent
of
insider trading as a
quantitative issue as a 'stunning misconception', adding that
'we
did not seek
to undertake any statistical tests or modelling; it was simply not that kind of
study' (Tomasic 1996:277). This response appears to equate 'quantitative'
with 'empirical', in the sense of research based on sampling and statistical
analysis. The description of the research as 'quantitative' refers not to a
particular methodology but only to the nature of investigating the 'extent' of
insider trading. Extent suggests frequency of occurrence or size
of
impact (on
the market) or a combination of both, which ultimately must be a quantitative
issue.
According to the published results (Tomasic &Pentony 1990: 125) the
objective of the study was to present 'systematically collected data regarding
the extent and prevalence of insider trading' and 'concrete empirical
evidence'. The question of extent, however, was not measured by direct
examination
of
insider trading itself but
of
perceptions held by interviewees.
This generated, in my submission, the difficulties encountered by Tomasic and
his colleagues in attempting to make conclusions regarding the extent or
*LLB (Hons), Associate Lecturer, Department of Commerce, The Australian National
University, Canberra.
200
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