The scarcity of suitable proxies for asymmetric information has impeded empirical research from providing reliable evidence on whether information risk shapes equity pricing. In re-examining this unresolved question, we rely on firms' geographic distance from financial centers to gauge...

We find that second-time IPOs (issuers that return to the IPO market successfully after withdrawing their first IPOs) sell at a significant discount relative to similar contemporaneous first-time IPOs (IPOs that succeed in their first attempts). This result indicates that the withdrawal event,...

We examine a sample of 132 dual tracking targets - private firms entertaining acquisition offers at the same time as preparing for initial public offerings (IPOs) and eventually withdrawing their IPOs to be acquired after spending considerable time, money, and effort preparing for IPOs. We find...

This paper provides a theory of informal communication (cheap talk) between firms and the capital market. The theory emphasizes the central role that agency conflicts play in firms' disclosure policies. Since managers' information is a consequence of their actions, incentive compensation and...

We analyze the relation between insider trading and the networks of executive and non-executive directors in UK listed companies. While most existing studies focus on firm-specific private information, we find that non-firm-specific information - such as information on other companies and...

We examine the relationship between the quality of corporate governance and information asymmetry in the equity market around quarterly earnings announcements. We use the change in market liquidity (i.e., bid-ask spreads and depths) around the announcements as a proxy for information asymmetry....

From 1987 to 2008, riskier firms were more likely to be taken over. Yet, on average, the acquirer declined in value by 2.8% when it bought a "risky target" (the third tercile, having an annualized idiosyncratic volatility of 61% or more), but only by 0.6% when it bought a "safe target" (the...

We study how corporate payout policy responds to changing investor tastes for non-dividend over dividend paying stocks following an increase in housing prices. Exploiting the crossregional dispersion in housing prices within the U.S. market, we find a significant negative effect of growth in...

This paper examines the initial public offering (IPO) valuations of issuers that return to the IPO market successfully after withdrawing their first IPO attempt. We find that these second-time IPOs sell at a significant discount relative to similar contemporaneous IPOs that succeed in their...

We examine executive stock option exercise activity around a sample of acquisition announcements between 1996 and 2006, particularly focusing on a subset of exercises that we identify as potentially informed. For stock-financed acquisitions, we find a surge in informed exercises by acquirers'...