Using new data on S&P 1500 firms’ CEO-to-employee pay ratios disclosed by mandate of Section 953(b) of the Dodd-Frank Act, we examine the effect of within-firm pay inequality on bond yield spreads. We find a significant negative relation between industry-adjusted CEO-to-employee pay ratio and...

Analyzing a set of 200 cryptocurrencies over the period from 2015 to 2019, we document a significant return reversal effect that holds at the daily, weekly, and monthly rebalancing frequencies and is robust to controls for differences in size, turnover, and illiquidity. Moreover, the reversal...

Prior research finds that stocks earn significantly higher returns in January compared to other months, with the effect most often attributed to tax-motivated selloffs in December leading to price reversion in January. We examine how patterns in turn-of-the-year performance impact prominent...

Using political corruption conviction data from the U.S. Department of Justice, we examine the impact of local corruption on firms’ debt maturity structure while exploring both demand-side and supply-side explanations. Our results support the demand-side story and indicate that firms located...

We provide evidence that discretionary loan loss provisions (DLLP) convey value-relevant information to the market that is highly dependent upon the state of the economy. DLLP is associated with negative abnormal returns during bad economic states characterized by growing default concerns, but...

We argue that research on small firms is less informative than most scholars believe, which suggests that researchers and practitioners know less than they think. Research in small firm finance is hindered by a lack of good data, vague descriptions of methodology in the extant literature, and...

We examine the valuation impact of employee-friendly (EF) culture. Using a sample of 3,457 firms from 43 countries for the period 2003 to 2014, we show that firms with a more EF culture have higher valuations (Tobin's q). The impact on valuation stems from improved technical efficiency and...

This paper examines relative risk aversion in the framework of a three moment asset pricing model that accounts for skewness. Accounting for skewness in calculating risk aversion gives a more accurate series of estimates of risk aversion and helps to reconcile the wide disparity in risk...

Recent research has studied the impact of asymmetry on cost of capital estimation, performance evaluation, and optimal portfolio composition. This study examines the impact of skewness preference on the risk premium of a gamble. The three-moment analogue of the Pratt-Arrow risk premium is...

This study investigates positive and negative price shocks in individual securities and the degree to which they affect related firms in the same industry. This price contagion effect is significant with initial price shocks leading to substantial long-term abnormal returns across firms in the...