Using a sample of 2,189 firms from 21 countries we find that, on average, stricter insider trading regulations reduce private information trading. However, for firms with high agency costs, insider trading restrictions are less effective in deterring private information trading. We suggest that...

Using a sample of 2189 firms from 21 countries we find that, on average, stricter insider trading regulations reduce private information trading. However, for firms with high agency costs, insider trading restrictions are less effective in deterring private information trading. We suggest that...

We point out several methodological flaws in previous research that concludes that managers mislead shareholders into selling their stock for too cheap by releasing overly negative information before stock repurchases. In particular, this research relies primarily on measured market reaction to...

We provide new evidence on IPOs over the industry life cycle. Less innovative, financially constrained firms seek public equity earlier in an industry's life cycle. Moreover, average profitability of early IPOs is lower when more private capital flows to the industry early in its growth phase....

Existing corporate governance research interprets positive correlation between institutional ownership and the success of mergers as evidence of active monitoring by institutional investors. The possibility that some institutional investors may have merely picked stocks that make better...

We show that partial equity ownership between rival firms has a significant impact on industry competition. Industry-level tests indicate that acquisitions of a minority stake in competing firms' equity are followed by higher output prices and higher price-cost margins, particularly in...

This paper demonstrates that a firm's need to hedge depends on the extent of hedging in its industry. When many firms in an industry experience common cost shocks, prices co-vary with costs providing firms with a 'natural hedge'. However, when hedging is widespread, prices do not offset cost...

We study the ability of US firms to manage interest rate risk during changes in monetary policy. From annual reports we extract interest rate derivative positions and analyze how they change with the cyclical movements in interest rates. Our hand-collected data follows firms' year-end positions...

Existing literature has shown that periods of high merger activity are correlated with high market valuations. Significantly more acquisitions occur when stock markets are booming than when markets are depressed. Using methodologies robust to recent criticism we show that viewed through an...

We show that divestitures accompanying horizontal mergers affect both the market power potential and the competitive efficiency of merging firms. Stock price reactions of customer firms are more positive (hence divestitures are more effective in mitigating the market power impact of the merger)...