Parigi, Bruno; Pelizzon, Loriana; von Thadden, Ernst-Ludwig - C.E.P.R. Discussion Papers - 2015
This paper analyzes why corporate governance matters for stock returns if the stock market prices the underlying … managerial agency problem correctly. Our theory assumes that strict corporate governance prevents managers from diverting cash … particular, the strictness of corporate governance is negatively related to earnings and positively to ß;. Various empirical …