Using geographically proximate institutions as a close approximation to informed investors, this paper examines the informational role of institutional investors in stock markets. We find that both the level of and change in local institutional ownership predict future stock returns; in...

Using foreign institutional ownership data in the U.S. from 1990 to 2007, we examine whether foreign institutional investors face liabilities of foreignness (LOF) in the U.S. stock market. We find that foreign institutional investors prefer low information asymmetry stocks more than domestic...

Using a large sample of mergers in the U.S., we examine whether corporate social responsibility (CSR) creates value for acquiring firms' shareholders. We find that compared to low CSR acquirers, high CSR acquirers realize higher merger announcement returns, higher announcement returns on the...

We examine which firms are targets of cyberattacks and how they are affected. We find that cyberattacks cause firms to reassess the risks that they are exposed to and their consequences, so that they have real effects on firm policies even when targets are not financially constrained....

We develop a model where a firm has an optimal exposure to cyber risk. With rational, fully informed agents and with no hysteresis, a successful cyberattack should have no impact on a financially unconstrained target's reputation and post-attack policies. In contrast, when a successful attack...

We examine the impact of geographic concentration of institutional investors on corporate governance and firm value. We find that firms whose large institutions are closely located to each other experience higher forced CEO turnover-performance sensitivity, more frequent proxy voting against...

We investigate the stakeholder theory of capital structure from the perspective of a firm's relationships with its employees. We find that firms that treat their employees fairly (as measured by high employee-friendly ratings) maintain low debt ratios. This result is robust to a variety of model...

We examine two competing views regarding the impact of competition among credit rating agencies on rating quality: the view that rating agencies do not sacrifice their reputation by inflating firm ratings and the view that competition among rating agencies arising from the conflict of interest...