The lock-in effect suggests that capital gains tax (CGT) creates a disincentive to sell appreciated stocks, as CGT is imposed once stocks are sold. A CGT rate decrease reduces the reluctance to sell appreciated stocks, thereby increasing the supply available for sale. Our study tests the lock-in...

This article uses the extended case method to explore senior executives' corporate finance decisions. We quantified firm's finance practices using a mail survey, and then - to resolve puzzles in managers' decision processes - conducted face-to-face interviews with chief finance officers of large...