Internal capital markets (ICMs) provide firms an alternative to costly external financing; however, they also provide an avenue to avoid the monitoring associated with issuing external capital. We argue that firms operating inefficient internal capital markets will avoid outside financing....

While internal capital markets may afford firms a real option to avoid costly outside financing [Matsusaka and Nanda (2002)], we show that they also provide an option to avoid the monitoring that accompanies the raising of capital. Consistent with this view, we find conglomerates which...

We posit that placing insiders on the board facilitates information flows to outside directors, mitigates the CEO's role as information gatekeeper, and allows managers to be more independent of the CEO. We find that inside directors are more prevalent in environments of greater information...

Using transactions generally overlooked in the compensation literature—joint ventures, strategic alliances, seasoned equity offerings (SEOs), and spin-offs—we find that, beyond compensation for increases in firm size or complexity, chief executive officers (CEOs) are rewarded for their...

Using transactions generally overlooked in the compensation literature mdash; joint ventures, strategic alliances, SEOs, and spinoffs mdash; we find that, beyond compensation for increases in firm size or complexity, CEOs are rewarded for their deal-making activities. Boards pay CEOs for the...

We investigate the information contained in the London Interbank Offered Rate (LIBOR) and the U.S. Constant Maturity Treasury (CMT) term structure of interest rates and report three novel findings. First, we document that the information contained in term structures are significantly different...

The lockup is an agreement between issuing firms and underwriting investment bankers that prohibits firm insiders from selling shares prior to lockup expiry. Using a manually corrected sample of 7546 SEOs between 1988 and 2007, this study investigates the role of these agreements by separately...

In a large sample of shareholder initiated class action lawsuits from 1996 to 2011, we find a significant increase in informed insider option exercises during the class action period compared to the preceding quarter, and we find that this change is positively related to the probability of...