The behavioral finance literature attributes failed M&As to CEO overconfidence. We investigate the source of CEO overconfidence that leads to failed M&As. Among various determinants of CEO overconfidence, we propose that power-led CEO overconfidence delivers undesirable consequences in corporate...

This paper examines how the investment horizons of a firm's institutional investors affect its corporate social responsibility (CSR) activities. Using data on U.S. firms' CSR ratings over the 1995–2012 period, we find that longer investment horizons are positively related to CSR. Further,...

Korean Abstract: 본 연구는 한국기업을 대상으로 자기과신적 최고경영자와 R&D 투자 간의 관계에 대해 조사하였다. 2002년부터 2014년까지 유가증권 및 코스닥 시장에 상장된 기업들을 대상으로 분석한 결과, 전체 기업에 대해서는...

Expected returns vary over time along with business cycles. Momentum payoffs are lack of rational explanation. This paper examines how the time-varying expected returns affect each individual firm differently, and hence what the cross-sectional phenomena are. The result shows that the model...

This paper investigates whether the relationship between investment banks and their affiliated funds helps the funds deliver superior performance due to the information advantage or whether it costs the funds due to the conflict of interest. Using firms with class-action lawsuits, I examine...

The consumption-based models have a lack of predictive power for explaining variability of stock returns. This paper examines two well-known models, Campbell and Cochrane (1999)'s habit model and Bansal and Yaron (2004)'s long-run risks model, to see whether they produce a significant power of...

This paper investigates whether the proximity between mutual funds and their investments could explain corporate innovation. I find that mutual funds investing in local firms increase firms' R&D expenditure and productivity. More importantly, firms with greater local ownership produce more...

I investigate how a firm's underwriting relationship affects its value. Firms that rely on underwriters' reputation for equity issuance could damage themselves when the reputation is contaminated. Using firms with class action lawsuits, I demonstrate that disclosed misconduct of an underwriting...

This study investigates the impact of board diversity on disaster preparation by firms. The Covid-19 crisis showed the importance of firms’ disaster preparedness as the pandemic disrupted global economic activity. Using financial flexibility as a proxy for disaster preparation, we find that...

In this paper, we examine whether the presence of ex-military board directors affects firms' financial policies and ethical behavior in Korea, a country where the military has a unique historical role in society. Despite prolonged exposure to military rule during their formative years, firms...