We assess the impact of compensation based incentives together with monitoring mechanisms on investment related agency costs. The results indicate that well structured compensation based incentives significantly reduce agency costs. Managerial firm based wealth delta has a significant, negative...

Macroeconomics remains in a parlous condition, largely because it has assumed away all financial frictions. Ultimately these latter depend on the possibility that borrowers might default on their repayments. Without default, there is no real role for most financial intermediations, collateral,...

Firms may exploit the option of choosing among different rating agencies in order to pick the highest rating offered. This possibility, known as rating shopping, is relatively limited on the US corporate bond market because the two main rating agencies (S&P and Moody's) rate virtually all large...

This study addresses the impact of equity market liquidity on Canadian economic growth and investigates how consumer attitudes/sentiments affect the dynamic macro-liquidity relationship. Using various market liquidity proxies (e.g., illiquidity ratio and open interest of equity futures) while...

This study provides estimation of public implicit guarantees over the period 1997 to 2012 using a rating-based model. The analysis focuses on a sample of 56 large listed European banks. It appears that the main element for determining the value of the public subsidy is the intrinsic strength of...

Risk-based allocation strategies, also known as Smart Beta allocations, define the weights of assets in portfolios as functions of the individual and common asset risk. In this paper we focus on the Minimum Variance (MV), Maximum Diversification (MD), Equal Risk Contribution (ERC) and...

This paper examines how bank risk varies with changes in financial markets development in a broad data set of 52 publicly listed commercial banks in five Southeast Asian countries over a 23-year period between 1990 and 2012. A consequence of two financial crises (i.e. the Asian financial crisis...

This paper fleshes out the rent extraction view of CEO compensation put forward by the managerial power theory (Bebchuk, Fried, & Walker, 2002), and tests its main implications on the relation between CEO power and the structure of CEO pay. For a measure of CEO power most relevant to managerial...

Some Chinese technology firms prefer to go public on US exchanges despite the launch of ChiNext as a NASDAQ-style board of the Shenzhen Stock Exchange in late 2009. Conventional hypotheses based on sales internationalization and issuing costs fail to explain this preference. Instead, our...

A competing risks hazard model is employed to examine the reasons for Hong Kong's Growth Enterprise Market (GEM) companies transferring to the Main Board (MB) in the period 2000–2012. In our sample during the period 21 companies or 15% of the original stock moved up to the MB. The modal life...