I invoke agency theory to evaluate how top executives' compensation contracts are structured, conditional on risk in the firm's operating environment, focusing on the total, fixed, and variable components. The results suggest that companies exert some effort to adhere to agency theoretic...

We compare non-GAAP EPS in annual earnings announcements and proxy statements using hand-collected data from SEC filings. We find that proxies for capital market incentives (contracting incentives) are more highly associated with disclosure of non-GAAP EPS in annual earnings announcements (proxy...

Prior research shows that firms generating earnings growth by improving profitability create shareholder value, while firms generating earnings growth through investment destroy value. This paper examines whether compensation committees consider this while determining CEO compensation. We first...

We document that CEO cash compensation is twice as sensitive to negative stock returns as it is to positive stock returns. Since stock returns include both unrealized gains and unrealized losses, we expect cash compensation to be less sensitive to stock returns when returns contain unrealized...

This paper separates the amount of IPO underpricing (primary market underpricing) and overvaluation (secondary market overvaluation) from the value of an IPO’s initial return to evaluate the relative importance of these two factors and their main determinants. Using data on the IPOs of 948...

The paper argues that bond investors (and, implicitly large creditors in general), may not necessarily demonstrate the “Investors' Smartness” that some previous studies attributed to large institutional holders, when it comes to pricing-in for economic shocks likely to occur in future. This...

This study uses international asset pricing models to investigate the link between the quality of government institutions and the performance of global stock markets. The results demonstrate a significant positive association between stock market performance measures and the quality of the...

We employ a sample of 748 environmentally-friendly (or “green”) firms listed on U.S. stock exchanges to extend studies of the effects of socially responsible investment (SRI) on stock investment returns and the performance of initial public offerings (IPOs) and seasoned equity offerings...

The prime purpose of this research is to find out that from the components of Dupont identity of Return on Equity which component is most consistent or volatile among profit margin, total assets turnover and equity multiplier in Fuel and Energy Sector, Chemicals Sector, Cement Sector,...

This paper examines expectations of earnings mean reversion implied by share prices. Those expectations are individually inaccurate, though correct on the market average. Investors generally expect slightly slower mean reversion rate (15% to 30%) than is ex-post observed (18% to 35%). They...