I consider voluntary disclosure of nonproprietary information. Established research presents two classes of models. Some authors assume that the manager can be sanctioned prohibitively high if he lies. Others assume cheap talk. I analyze a setting with positive but non-prohibitive punishments....

The notion of awareness is introduced to study Regulation Fair Disclosure, a rule implemented by the U.S. Security and Exchange Commission in 2000. The regulator aims to reduce information asymmetry among investors, and expects public forums to subsume the forbidden information channel of...

An informational advantage enjoyed by select few around material announcements was the concern raised by SEC in passing Regulation Fair Disclosure. To date, no large study has examined this question. We document stock price movements in the direction of the news two days prior to the...

Corporate governance has received an increasing amount of attention in recent years. Corporate scandals have brought corporate governance weaknesses to the attention of the general public, especially in the United States. But corporate governance is sometimes a problem in other countries as...

Hundreds of articles have been written about various aspects of insider trading. It is one of those topics that is truly interdisciplinary, touching on finance, economics, law, business ethics and perhaps a few other disciplines. Yet with all this research there is still no consensus about when...

This paper presents some stylised facts about the book-tax gap, i.e., the difference between book and taxable income, of Italian corporations. This divergence is a reflection of the usage of any tax shields and any applicable credits and rebates which, in turn, implies that the concept of...

This study examines management of operating cash flows, its causes, and the market's reaction to such management. Applying a Burgstahler and Dichev (1997)/Degeorge et al. (1999) type methodology and the best-fitted distribution method, I find indications that managers take actions to report...

In this paper we determine the strategic exercise of an IPO option in a framework of asymmetric information. Private owners are exposed to the idiosyncratic risk of the firm while public investors are not fully informed about the type of the firm. Idiosyncratic risk creates an incentive for...

This paper investigates the motivations for managers' decisions to overstate earnings and examines the consequences of such decisions. We examine firms subject to enforcement actions by the Securities and Exchange Commission for having violated the financial reporting requirements of the...

This paper argues that the relation between financial analysts' earnings forecast accuracy and their recommendation profitability has to be augmented by the extent of commonality in their forecast errors. We show that while accuracy is positively related to expected performance, the correlation...