This paper examines the effect of risk management incentives resulting from managerial bonus plans on firms' derivatives usage. Partitioning the sample into firms whose managers are more likely to face convexity or concavity in the bonus payoff function, we find a negative relation between bonus...

This study investigates the associations among bank risk-taking, ownership concentration, and the recently proposed standard for capital stability (Basel III). Consistent with theory, the evidence shows that a rise in ownership concentration by one standard deviation increases the extent of...

Earnings play a vital role in portraying a company's economic health. Hence, executives have incentives to manage earnings. Motivated by Degeorge et al. [Degeorge, F., Patel, J., Zeckhauser, R., 1999. Earnings management to exceed thresholds. Journal of Business 72, 1-33] and Burgstahler and...

Thailand was at the origin of the Asian financial crisis of 1997. Our research seeks to understand what economic and political factors contributed to the collapses of Thailand's financial institutions during the crisis. The distinctive feature of our model is that it incorporates variables for...

We explore the impact of liquidity on capital structure decisions. Firms that enjoy more liquid equity experience a lower cost of equity and may be more motivated to adopt more equity and less debt in their capital structure. Consistent with this notion, the empirical evidence demonstrates an...

We study the difference between U.S.-based multinational corporations (MNCs) and U.S. domestic corporations (DCs) in terms of management efficiency with return on capital as the measure of management efficiency. We use a fixed effect model to account for heterogeneity and/or the time-specific...