In this paper we study Norwegian rights issues with focus on the announcement effects of raising seasoned equity. The abnormal returns at announcement in Norway are around −8% to −10% for rights issues, and this is much higher than what is found in other countries. The average...

This study gives first evidence on the consequences of the introduction of a transaction tax in Italian financial markets in 2013. We discuss the consequences of this tax on trading volume, volatility, and trading costs of FTSE MIB stocks. The structure of the tax introduction gives us the...

Regulators in Belgium, France, Italy and Spain issued a short sales ban on financial stocks to contain volatility in August 2011. This paper uses a quasi-experimental approach to assess the ban's effectiveness. Control groups in the study are the ADRs of the banned financial stocks and their...

We investigate the effects of market structure on bank profitability in 40 emerging and advanced economies. We find that bank profitability in relation to market structure is different between developed and emerging banking markets. First, in developed banking sectors, profitability is...

We address the Lakonishok, Shleifer and Vishny (LSV) herding measure. Frey, Herbst and Walter (FHW) have shown by empirical simulations that LSV is biased. Using a theoretical model we provide a formal explanation of this bias, and show that a corrected herding measure depends on some...

This paper examines the effects of the current financial crisis on the correlations of four international banking stocks. We find that in the beginning of the crisis banks generally show a transition to a higher correlation followed by a dramatic decline towards the end of 2008. These findings...

Abel (2002) proposes a resolution of the riskfree rate and the equity premium puzzles by considering pessimism and doubt. Pessimism is characterized by subjective probabilistic beliefs about consumption growth rates that are stochastically dominated by the objective distribution. The subjective...

We analyze why formal credit, informal credit, and both types of credits coexist as consumer choices. We construct a model in which the households pay a fixed cost to access each type of market and face a market particular interest rate. The model induces a cost curve that defines an optimal,...

The Ali (2013, EB) findings on the nexuses among institutions, finance and investment could have an important influence on policy and academic debates. This paper relaxes his hypotheses on the conception, definition and measurement of finance and institutions because they are less realistic to...

Why are women financially excluded? Is there an association between women empowerment laws, prevalence of discriminatory attitudes in a society towards women and financial empowerment of women? Using a cross-country survey, this paper finds statistical evidence that suggests women are...