We investigate the impact of the initiations of national audit inspection programs on firm-specific stock crash risk in 38 countries worldwide. The staggered commencement of the inspection regimes in different countries allows us to identify the causal effect of audit quality on crash risk. We...

This paper examines the effect of product market threats on firms' stock crash risk. Competitive pressure from the product market aggravates managers' incentive to withhold negative information. When negative information is accumulated to a tipping point, the accumulated information all comes...

Human beings’ decision-making processes are generally influenced by two typical cognitive biases: representativeness heuristic bias and conservatism bias. Previous studies found that the two cognitive biases cause investors to misreact to past stock earnings. This paper argues that the two...