This paper presents a formal analysis of the relation between monitoring and limit order submission risk. With heterogeneous information, limit order traders face two types of risks. First, they may be picked off when prices change unexpectedly after the limit order is entered (known as free...

This study examines the informational role of home media for foreign equity investment. Using a large sample of 38 host countries, we document a positive association between U.S. mutual fund ownership in a local stock and the coverage of U.S. major news providers on that stock. In addition to...

This paper empirically examines limit order revisions and cancellations which contribute to a significant portion of the order activity in many order-driven markets. We document that limit orders are more likely to be revised or cancelled if they are large and near the bid-ask quote. We show...

In order-driven markets, orders can be strategically submitted at aggressive prices during the pre-opening phase and withdrawn just before trading commences. Based on a Kyle (1989) setting, we develop several predictions regarding how such quot;strategicquot; orders can temporarily distort price...

This study employs firm-specific announcements as a proxy for information flows and investigates the information-volatility relation using high-frequency data from the Australian Stock Exchange. Our analysis reveals a positive and significant impact of the arrival rate of the selected news...

Do people "vote with their feet" due to a lack of political competition? We formalize the theory of political competition and migration to show that increasing political competition lowers political rent leading to net in-migration. Our empirical application using US data supports this...

We model and predict that politicians have incentives to delay bank failure in election years and that this incentive is exacerbated if the election is close. Our empirical application using the US data supports these predictions. At the bank level, we show that bank failure in an election year...

We examine changes to corporate ownership in nine East Asian countries following the 1997 Asian Financial Crisis. Countries with lower incomes and in which policy making involves greater transactions costs (i.e., veto points) have more firms with state ownership. Partial state ownership appears...

Rights issues are intended to safeguard existing shareholder interests, but puzzlingly, they attract low shareholder participation. We study the vulnerability of rights holders to market distortions from short sales. Using a comprehensive cross-country dataset, we document a one-third reduction...