Previous studies have shown that the pattern of first day returns to initialpublic offerings is consistent with the hypotheses of underpricing and price support. We examine two different periods, 1975–1984 and 1996–2002, and find that in each case the measures of price support and...

Like security prices, retail deposit interest rates cluster around integers and "even" fractions. However, explanations for security price clustering are incompatible with deposit rate clustering. A theory based on the limited recall of retail depositors is proposed. It predicts that banks tend...

This paper uses Taiwanese data to examine the impact of firm-level corporate governance mechanisms on firms’ average cash holdings. Specifically, it examines how a firm’s number of banking relationships and the percentages of managerial ownership and board ownership impact the firm’s level...

This paper analyzes interest rates quoted by individual banks for personal and automobile loans in 10 cities. Personal loan rates are higher in concentrated markets, and banks involved in mergers reduce personal rates relative to their competitors prior to the merger's completion. This is...

We construct a set of household-level background risk variables to capture the covariance structure of three nonfinancial assets and two financial assets. These risks are in general statistically significant and economically important for a household's stock market participation and stock...

Recent corporate scandals have raised considerable concern among regulators and stock market participants about related party transactions (RPTs), prompting Sarbanes-Oxley (SOX) to prohibit personal loans to executives and non-executive board members. In a representative sample of companies for...

We study the relationship between governance changes and firm characteristics and the impact of governance changes on future firm performance using a sample of firms that make large positive and large negative changes in thirteen governance measures. We find that the governance changes are...

One possible explanation for bidding firms earning positive abnormal returns in diversifying acquisitions in the 1960s is that internal capital markets were expected to overcome the information deficiencies of the less-developed capital markets. Examining 392 bidder firms during the 1960s, we...