The article formulates the information theory of firm, introduces the concept of firm as an operating system, which controls the firm’s operation by the means of the information resources processing, in an analogy with the operating system at a microprocessor in the computing devices,...

This study addresses the relationship between incentive compensation and complex outsourcing in somewhat different vein. The agency theory suggests, firstly that managers are constantly faced with allocation of efforts and choices and within this context their decisions are driven by incentive...

A robust result in the literature on strategic incentives pioneered by Fershtman and Judd (1987), Sklivas (1987), and Vickers (1985) is that under quantity competition firm owners induce their managers to make aggressive quantity choices in the product market. We revisit this result in a...

We examine the impact of corporate risk-taking on firm-level real earnings management. We find that firms with higher risk-taking engage in higher real earnings management. Our results are robust to a series of robustness tests, including simultaneous least squares approach, firm fixed effect,...

We analyze how ownership concentration and type, and board independence are related to corporate social performance (CSP). Drawing from agency, team production and stakeholder perspectives, we argue that the distribution of costs and benefits to shareholders and other stakeholders is crucial to...

The present study aims to examine the relationship between dividend policy and earnings management by explicitly considering the role of the agency problem and financing constraints. The sample comprises 3250 non-financial Chinese listed firms from 2009 to 2018. This study uses fixed- and random...

Research summary: Drawing on the “varieties of capitalism” literature, we develop an actor-centered framework that explains firm-level corporate social performance (CSP) by emphasizing the importance of considering owners' and other stakeholders' motives towards CSP — which can be...

We test the association between CFO effort and the quality of public firms' financial information environments. We evaluate this relation using a measure of CFO leisure consumption – specifically, the amount of golf played – as an inverse proxy for effort. We find that CFOs consume more...

We examine the relation between passive ownership and financial reporting quality measured by Beneish's (1999) earnings' manipulation score (M-score). We find that passive ownership is negatively related to M-score and to the likelihood of being designated as a “manipulator” firm. However,...

This study uses the 2008 mortgage crisis to demonstrate how the relationship between vertical integration and performance crucially depends on corporate governance. Prior research has argued that the vertical integration of mortgage origination and securitization aligned divisional incentives...