Similar Search Results

Chen, Donghua; Jiang, Dequan; Ljungqvist, Alexander; … - National Bureau of Economic Research (NBER) - 2015

capital to units with better investment opportunities, state groups do the opposite. Minority shareholders in state owned … groups’ tendency to ignore investment opportunities. We conjecture that capital allocations at state groups reflect the …

Persistent link: https://www.econbiz.de/10011165127

Do Acquisitions Relieve Target Firms' Financial Constraints?

Erel, Isil; Jang, Yeejin; Weisbach, Michael S. - National Bureau of Economic Research (NBER) - 2013

the level of cash target firms hold, the sensitivity of cash to cash flow, and the sensitivity of investment to cash flow … all decline significantly, while investment significantly increases following the acquisition. These effects are stronger …

Persistent link: https://www.econbiz.de/10011188516

The Mystery of Zero-Leverage Firms

Strebulaev, Ilya A.; Yang, Baozhong - National Bureau of Economic Research (NBER) - 2012

This paper documents the puzzling evidence that a substantial number of large public non-financial US firms follow a zero-debt policy. Over the 1962-2009 period, on average 10.2% of such firms have zero debt and almost 22% have less than 5% book leverage ratio. Neither industry nor size can...

Persistent link: https://www.econbiz.de/10011188562

CEO Investment Cycles

Pan, Yihui; Wang, Tracy Yue; Weisbach, Michael S. - National Bureau of Economic Research (NBER) - 2013

This paper documents the existence of a CEO Investment Cycle, in which firms disinvest early in a CEO's tenure and … increase investment subsequently, leading to "cyclical" firm growth in assets as well as in employment over CEO tenure. The CEO … investment cycle occurs for both firings and non-performance related CEO turnovers, and for CEOs with different relationships …

Persistent link: https://www.econbiz.de/10010950835

Financing Through Asset Sales

Edmans, Alex; Mann, William - National Bureau of Economic Research (NBER) - 2013

result is robust to using the cash for an uncertain investment. Second, firms can disguise the sale of a low-quality asset as …

Persistent link: https://www.econbiz.de/10010950971

Governing Misvalued Firms

Kadyrzhanova, Dalida; Rhodes-Kropf, Matthew - National Bureau of Economic Research (NBER) - 2014

Equity overvaluation is thought to create the potential for managerial misbehavior, while monitoring and corporate governance curb misbehavior. We combine these two insights from the literatures on misvaluation and governance to ask 'when does governance matter?' Examining firms with standard...

Persistent link: https://www.econbiz.de/10010950985

Learning about CEO Ability and Stock Return Volatility

Pan, Yihui; Wang, Tracy Yue; Weisbach, Michael S. - National Bureau of Economic Research (NBER) - 2013

When there is uncertainty about a CEO's quality, news about the firm causes rational investors to update their expectation of the firm's profitability for two reasons: Updates occur because of the direct effect of the news, and also because the news can cause an updated assessment of the CEO's...

Persistent link: https://www.econbiz.de/10010951298

Does Uncertainty about Management Affect Firms’ Costs of Borrowing?

Pan, Yihui; Wang, Tracy Yue; Weisbach, Michael S. - National Bureau of Economic Research (NBER) - 2014

Uncertainty about management appears to affect firms’ cost of borrowing and financial policies. In a sample of S&P 1500 firms between 1987 and 2010, CDS spreads, loan spreads and bond yield spreads all decline over the first three years of CEO tenure, holding other macroeconomic, firm, and...

Persistent link: https://www.econbiz.de/10011071744

Who Makes Acquisitions? CEO Overconfidence and the Market's Reaction

Malmendier, Ulrike; Tate, Geoffrey - National Bureau of Economic Research (NBER) - 2004

Overconfident CEOs over-estimate their ability to generate returns. Thus, on the margin, they undertake mergers that destroy value. They also perceive outside finance to be over-priced. We classify CEOs as overconfident when, despite their under-diversification, they hold options on company...

Persistent link: https://www.econbiz.de/10005034329

The Structure and Formation of Business Groups: Evidence from Korean Chaebols

Almeida, Heitor; Park, Sang Yong; Subrahmanyam, Marti; … - National Bureau of Economic Research (NBER) - 2009

In this paper we study the determinants of business groups' ownership structure using unique panel data on Korean chaebols. In particular, we attempt to understand how pyramids form over time. We find that chaebols grow vertically (that is, pyramidally) as the family uses well-established group...

Persistent link: https://www.econbiz.de/10005034540