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We test under what circumstances boards discipline managers and whether such interventions improve performance. We exploit exogenous variation due to the staggered adoption of corporate governance laws in formerly Communist countries coupled with detailed ‘hard’ information about the...
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Using an experimental design that exploits exogenous reductions in coverage resulting from brokerage house mergers, we find that a reduction in coverage causes a deterioration in financial reporting quality. The effect of coverage on disclosure is more pronounced for firms with weak shareholder...
Persistent link: https://www.econbiz.de/10010678708
Busy directors have been widely criticized as being ineffective. However, we hypothesize that busy directors offer advantages for many firms. While busy directors may be less effective monitors, their experience and contacts arguably make them excellent advisors. Among IPO firms, which have...
Persistent link: https://www.econbiz.de/10010665549
We review recent evidence and future directions for empirical research on financial contracting in the context of corporate finance. Specifically, we survey evidence pertaining to incentive conflicts, control rights, collateral, renegotiation, and interactions between financial contracts and...
Persistent link: https://www.econbiz.de/10008777005
In the bank-borrower setting, a firm's existing lender may exploit its positional advantage to extract rents from the firm in subsequent financings. Analogously, a startup's existing venture capital investors (VCs) may dilute the founder through a follow-on financing from these same VCs (an...
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key input that drives innovation at the firm- and economy-wide levels. …
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We examine the effects of financial analysts on the real economy in the case of innovation. Our baseline results show … of analyst coverage on firm innovation. The evidence is consistent with the hypothesis that analysts exert too much … possible underlying mechanisms through which analysts impede innovation and show that there is a residual effect of analysts on …
Persistent link: https://www.econbiz.de/10011039260