This paper examines whether cultural dimensions explain the variation in corporate cash holdings around the world as well as within the United States. We establish four major findings. First, in an international setting, corporate cash holdings are negatively associated with individualism and...

Using a sample of U.S. firms between 1996 and 2011, this paper documents a positive association between options trading volume and future stock price crash risk. This relation is evidently more pronounced among firms with higher information asymmetry, business uncertainty, and short-sale...

We examine the impact of managerial mood on corporate tax avoidance—a ubiquitous corporate decision. Using variation in local sunshine as exogenous shocks to managerial mood, we report strong, robust evidence that negative mood induced by cloudy weather leads firms to undertake more aggressive...

We study how media coverage impacts pricing of IPOs around the world. Higher media coverage in the pre-IPO period leads to lower IPO initial returns. The effect is mitigated in countries with better financial reporting quality, greater shareholder rights protection, and more stringent media...

We examine the role and economic consequences of emotions in influencing the judgment of corporate executives. Analyzing a large sample of U.S. public firms, we find that sunshine-induced good mood leads managers to make upwardly biased earnings forecasts. Importantly, our evidence implies that...

We propose that extra-organizational factors such as exposure to sunshine are an important driver of innovators' performance. Prior research highlights the critical role non-pecuniary factors play in influencing inventors' productivity, yet most of these studies focus on organizational and job...

In this paper, we examine how cultural norms along the dimensions of individualism-collectivism and uncertainty-avoidance affect corporate innovation. Using a comprehensive sample across 41 countries, we find that firms located in countries with higher levels of individualism generate more and...

The finance literature offers two competing possibilities on how investors respond to the quality of public financial statements in their pricing decisions. They could collect either (a) more private information to benefit from lower information collection cost or (b) less private information...

This paper examines whether managerial ability facilitates corporate innovative success. First, we show that managerial ability is positively associated with innovative output. Second, we show that the positive association between managerial ability and innovative output is weaker for older CEOs...

This paper examines the role of local attitudes towards gambling on corporate innovative activity. Using a county's Catholics-to-Protestants ratio as a proxy for local gambling preferences, we find that firms located in gambling-prone areas tend to undertake riskier projects, spend more on...