We investigate whether market makers with inventory concerns are compensated with subsequent monthly returns in the cross-section. We find a significant negative relation between order flows and monthly returns, “the order flow effect”, suggesting that market makers lower prices for stocks...

This article investigates how “systematic” adjustment costs proxied by market imperfections, and macroeconomic conditions affect capital structure dynamics in a cross-country setting. We document substantial variations in firms' capital structure adjustments across countries and,...

We document that corporate investment contributes to stock liquidity. This study demonstrates a positive relationship between abnormal corporate investment and stock liquidity in the crosssection. Moreover, stock liquidity improves more apparently for firms with financial constraints. Our...