This study examines the impact of stock market liberalization on corporate investment and its underlying mechanisms in the context of the Mainland–Hong Kong Stock Connect programs in China. The difference-in-differences estimation suggests that stock market liberalization improves corporate...

This paper exploits the 2003 mutual fund trading scandal to investigate firms’ seemingly myopic investment behavior following negative stock price shocks. Firms affected by the scandal are more likely to meet or marginally beat earnings targets by cutting research and development and other...

We examine how the regulation of financial reporting frequency affects corporate innovation. We use a difference-in-differences approach based on a sample of treatment firms that experience a change in their reporting frequency and matched industry peers and control firms whose reporting...

This paper demonstrates the usefulness of earnings management in correcting stock underpricing. We find that underpricing, measured using mutual fund fire sales or the 2003 trading scandal as a shock, increases the likelihood of firms meeting or marginally beating analyst forecasts. Firms beat...