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Strebulaev, Ilya A.; Yang, Baozhong - In: Journal of Financial Economics 109 (2013) 1, pp. 1-23

zero debt and almost 22% have less than 5% book leverage ratio. Zero-leverage behavior is a persistent phenomenon. Dividend …-paying zero-leverage firms pay substantially higher dividends, are more profitable, pay higher taxes, issue less equity, and have …

Persistent link: https://www.econbiz.de/10010665554

Corporate social responsibility and stakeholder value maximization: Evidence from mergers

Deng, Xin; Kang, Jun-koo; Low, Buen Sin - In: Journal of Financial Economics 110 (2013) 1, pp. 87-109

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

Persistent link: https://www.econbiz.de/10010702376

Are red or blue companies more likely to go green? Politics and corporate social responsibility

Di Giuli, Alberta; Kostovetsky, Leonard - In: Journal of Financial Economics 111 (2014) 1, pp. 158-180

Using the firm-level corporate social responsibility (CSR) ratings of Kinder, Lydenberg, Domini, we find that firms score higher on CSR when they have Democratic rather than Republican founders, CEOs, and directors, and when they are headquartered in Democratic rather than Republican-leaning...

Persistent link: https://www.econbiz.de/10010718733

Monitoring and corporate disclosure: Evidence from a natural experiment

Irani, Rustom M.; Oesch, David - In: Journal of Financial Economics 109 (2013) 2, pp. 398-418

Using an experimental design that exploits exogenous reductions in coverage resulting from brokerage house mergers, we find that a reduction in coverage causes a deterioration in financial reporting quality. The effect of coverage on disclosure is more pronounced for firms with weak shareholder...

Persistent link: https://www.econbiz.de/10010678708

The economics of club bidding and value creation

Marquez, Robert; Singh, Rajdeep - In: Journal of Financial Economics 108 (2013) 2, pp. 493-505

Many acquisitions are conducted by clubs, i.e., coalitions of acquirers that submit a single bid. We present a novel analysis of club bidding where the club creates value by aggregating, at least partially, bidders' values. We show that club formation can lead to higher acquisition prices when...

Persistent link: https://www.econbiz.de/10010664047

Are busy boards detrimental?

Field, Laura; Lowry, Michelle; Mkrtchyan, Anahit - In: Journal of Financial Economics 109 (2013) 1, pp. 63-82

Busy directors have been widely criticized as being ineffective. However, we hypothesize that busy directors offer advantages for many firms. While busy directors may be less effective monitors, their experience and contacts arguably make them excellent advisors. Among IPO firms, which have...

Persistent link: https://www.econbiz.de/10010665549

Do analysts matter for governance? Evidence from natural experiments

Chen, Tao; Harford, Jarrad; Lin, Chen - In: Journal of Financial Economics 115 (2015) 2, pp. 383-410

Building on two sources of exogenous shocks to analyst coverage (broker closures and mergers), we explore the causal effects of analyst coverage on mitigating managerial expropriation of outside shareholders. We find that as a firm experiences an exogenous decrease in analyst coverage,...

Persistent link: https://www.econbiz.de/10011189253

The dark side of analyst coverage: The case of innovation

He, Jie; Tian, Xuan - In: Journal of Financial Economics 109 (2013) 3, pp. 856-878

We examine the effects of financial analysts on the real economy in the case of innovation. Our baseline results show that firms covered by a larger number of analysts generate fewer patents and patents with lower impact. To establish causality, we use a difference-in-differences approach that...

Persistent link: https://www.econbiz.de/10011039260

Public market staging: The timing of capital infusions in newly public firms

Hertzel, Michael G.; Huson, Mark R.; Parrino, Robert - In: Journal of Financial Economics 106 (2012) 1, pp. 72-90

We examine financing activities of newly public firms for evidence on capital staging in the public equity market. Staging (sequential financing) can increase issuance costs but can limit costs associated with overinvestment. We find evidence consistent with the hypothesis that staging is...

Persistent link: https://www.econbiz.de/10010593847

Behavioral consistency in corporate finance: CEO personal and corporate leverage

Cronqvist, Henrik; Makhija, Anil K.; Yonker, Scott E. - In: Journal of Financial Economics 103 (2012) 1, pp. 20-40

We find that firms behave consistently with how their CEOs behave personally in the context of leverage choices …. Analyzing data on CEOs' leverage in their most recent primary home purchases, we find a positive, economically relevant, robust … relation between corporate and personal leverage in the cross-section and when examining CEO turnovers. The results are …

Persistent link: https://www.econbiz.de/10010702365

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