Abstract This study investigates whether firms located in areas with higher levels of religiosity disclose higher‐quality management earnings forecasts than do other firms. Using a US sample 4,655 firm‐year observations over the period 2001 to 2014, we find that headquartered counties proportions religious adherents issue are less optimistically biased and effect is concentrated weak monitoring mechanisms. We also mitigates pessimistic bias forecasts, but only for those issued by operating...

Despite the fruitful research on motives and outcomes of cross‐border mergers acquisitions (M&As) Chinese multinational corporations ( MNCs ), there has been scant impact M&As corporate governance. In this article, we fill gap by exploring whether may lead to an improvement in governance acquirers. particular, examine earnings quality . We find that acquisition a target firm from developed country leads significant acquirer's quality. comparison, emerging market does not have such...

Evidence from recent financial debacles suggests that crowding can adversely impact the subsequent performance of crowded investments and destabilize markets. However, term "crowding" has been used loosely in public media. To be precise, authors define develop a measure captures interaction correlated trades illiquidity use this metric to study how on stocks by mutual funds affects returns for period 1981 2012. They find strong negative association between quarterly two quarters ahead. More...

Publicly traded firms in China rely heavily on equity financing and are constrained debt financing. Gaining access to the public market substantially alleviates constraint. The ratio of that have is approximately 14 percent higher than without access. Everything else being equal, gaining significantly increases by 3.44 percent, this increase concentrated long-term debt. We further find non-SOEs enjoy greater benefits from SOEs, as evidenced an their total ratio. For offset decrease...

The aim of this study is to examine: (i) whether strategic institutional ownership associated with better earnings quality at the international level, and (ii) relationship varies strength investor protection. Using firm level data from 41 different countries, we document a positive association between quality. More importantly, find that documented economically more significant in countries stronger Our results are robust battery robustness tests. We interpret our findings as evidence...

China has experienced an incredible rate of growth in the past four decades. Along with remarkable economic achievements, we witnessed rapid development China’s financial system. When ...

We study the high-moment distribution of hedge fund returns and identify factors that drive risk. Using monthly returns, we find a strong correlation between first four moments (i.e. mean, standard deviation (SD), skewness, kurtosis) different characteristics funds such as leverage, liquidity, incentives, strategy-related factors. after controlling for other factors, incentives-related fund’s specific strategy have greatest impact on returns. Our evidence also suggests investors allocate...

We examine whether and how creditor monitoring affects corporate social responsibility (CSR) activities through the observable event of debt covenant violations. Covenant violations shift control rights to creditors, allowing creditors strengthen on firm policies. Employing a quasi-regression discontinuity design, we document differential effects various components CSR activities: firms tend reduce related employee community welfare, while leaving largely intact that can have long-term...

In this paper, I design a measure of stock-level sentiment, the per-unit mutual fund concentration (PUMFC). It is obtained by dividing number managers holding stock its market capitalization. The new takes difference opinion, optimistic investors, and short-sales constraint into account. can significantly predict lower return in second coming quarter. A cross-sectional study based on 10 portfolios sorted PUMFC suggests that, with an increase PUMFC, abnormal decreases systematic risk...

Traditional literatures document that the longer-term institutional investor serves as a better monitoring mechanism and is associated with corporate policy. In this paper, I exam its impact on financing decisions find an entrenchment effect of long-term holdings for first time. investment horizon negatively firms’ likelihood issuing equity debt also amount security issuance; in addition, firms longer adjust their capital structure at slower pace, more when over-levered less under-levered,...