American Depository Receipts (ADRs) represent shares of foreign firms that are issuedand traded in the U.S. Since an ADR and its underlying shares represent ownership interest ofthe same firm, they should be perfect substitutes in a perfect market. However, marketimperfections such as differences in information environment, liquidity, investment and tradingrestrictions, taxes, control right, corporate governance might make them less-than-perfectsubstitutes. These imperfections, on the other hand, also present opportunities for research.This dissertation consists of two essays on ADRs, both related to the effects of less-thanperfectinformation. Specifically, the first essay examines the return and volatility transfersbetween ADRs and their underlying home shares. Our investigation differs from the previousstudies in that we cover substantially more countries and that we attempt to explain the variationsin the extents of transfer effects both across firms and across countries. Various hypotheses aredeveloped, based on the premise that barriers associated with trading, investments, and corporategovernance would lower the extent or effectiveness of transfers. Overall, our empirical resultssupport these hypotheses.The second essay takes the viewpoint of the issuing firms. Supposedly, an issuer’s timingand dollar amount raised depend on the conditions of three markets: its home equity market, theU.S. equity market, and the currency market. From purely the standpoint of informationaccessibility, ADR issuers are likely to time their issues or set their amounts with respect to theconditions of the home equity market and/or currency market, with which they are more familiar.On the other hand, issuers typically employ the assistance of U.S. investment banks, andtherefore they may be well-informed about the U.S. equity market. This is largely an empiricalissue. Generally, our empirical results are mixed, but there is somewhat stronger evidence for the U.S. equity market being more important when setting the issue amount. There is also evidencethat suggests regulations having influences on such activities.