On November 8, 2002, two new exchanges, OneChicago and NQLX, began trading single stock futures (SSFs) in U.S. We study how these exchanges choose the listed products, and we compare the trading volumes on the two exchanges. The selection process is consistent with the objective of maximizing...

We model that firms endogenize the extent of information asymmetry by choosing the optimal level of direct communications with capital markets. We find that leaner firms with less slack (lower cash balance and higher long-term leverage) tend to have greater formal communications. We show that...

Using a unique and rich database of high-technology firms in China, we show that effective enforcement of intellectual property rights at the provincial level is critical in encouraging financing and investing in R&D. Better enforcement of intellectual property (IP) rights positively affects...

Financing of and investing in Ramp;D are prone to risks of appropriation by competitors, information asymmetry, and agency problems. Although legal protection of intellectual property (IP) rights at the national level is necessary to encourage investing in Ramp;D, we show that the effective...

We examine the role of financial analysts in forming institutional investors' investment decisions. We model how a fund manager invests in a stock based on reports produced by a biased sell-side analyst and an unbiased buy-side analyst. She weighs the two reports in her decision making, and puts...

We examine the role of financial analysts in forming institutional investors' investment decisions. In our model, a fund manager invests in a stock based on the optimal weighting of reports created by a biased sell-side analyst and an unbiased buy-side analyst. The manager puts a higher weight...

This paper provides a link that integrates public finance and corporate finance. We analyze a world in which costly tax avoidance or evasion could occur. The class of solutions considered here involve changes in the tax system that economize on the deadweight costs of avoiding taxes and...

We examine a large sample of mergers involving earnout payments made by bidders to target shareholders. Our findings suggest that earnouts serve two non-mutually-exclusive functions: as risk reduction mechanisms against misvaluation of high asymmetric information targets, and as retention...

We investigate empirically the nature of Japanese executives' compensation contract. The principal issues examined are: the extent Japanese executives are rewarded for performance both in the short term and in the long term, the role of alternative governance and control mechanisms unique to...

The volume of acquisitions involving privately held firms has far surpassed that of publicly traded firms in recent years; yet this segment of the take-over market remains largely unexplored. In analysing the unique features of private target take-overs, we compare the mergers and acquisitions...