We evaluate the impact of European antitrust policy by analyzing the stock market response to investigation announcements, infringement decisions, and appeals. We examine a sample of 253 companies involved in 118 European antitrust cases over the period 1974-2004. We uncover significantly...

Liquid stocks may attract short-term traders who could attenuate the informativeness of stock prices about long-run fundamentals. As a result, managers may be less (more) likely to rely on the market prices of more (less) liquid stocks when making real investment decisions. Supporting this...