This paper examines the relation between corporate lobbying and fraud detection. Using data on corporate lobbying expenses between 1998 and 2004, and a sample of large frauds detected during the same period, we find that firms’ lobbying activities make a significant difference in fraud...

This paper explores rent-seeking behavior in a heavily regulated equity-financing market. Using manually-collected information about ownership changes from China's IPO application filings for the Growth Enterprise Market (GEM), we find that over a third of firms receive late-stage private equity...

This paper examines the real effects of outlier opinions in the context of extreme analyst optimism. We find that managers appear to respond to the extremism in outlier forecasts with more aggressive earnings management, instead of ignoring them as noise. The effect of extreme optimism is more...

We perform transaction-level analyses of entrusted loans—one of the largest components of shadow banking in China. Entrusted loans involve firms with privileged access to cheap capital channeling funds to less privileged firms, and increase when credit is tight. Nonaffiliated loans have much...

A medium - for example, points or money - is a token people receive as the immediate reward of their effort.It has no value in and of itself, but it can be traded for a desired outcome. Experiments demonstrate that, when people are faced with options entailing different outcomes, the presence of...

How does previous military experience affect corporate managers’ behavior in earnings management? Using a sample of listed Chinese firms, we find that managers with military experience are associated with higher levels of earnings management, through both accrual-based and real-activities...