This paper studies the mechanism of industry cluster and revisits two cases of the Cambridge phenomenon. Based on the theoretical study and numeric simulation, the paper finds that: first, knowledge spillovers destroy normal Hotelling Process and lead to regional industry cluster. The density of...

Rights offers and new issues to non-existing shareholders are two major flotation methods used in seasoned equity offerings (SEOs) worldwide. Yet the existing literature has been unable to explain within the same framework: (a) why some firms choose rights offers and other firms choose new...

Opportunities for controlling shareholders to expropriate minority shareholders come largely from insider information. These opportunities and hence private benefits of control, largely under asymmetric information, can vary substantially across firms even within the same legal environment. As a...

This paper generalizes the Myers and Majluf (1984) model by introducing an agency cost structure based on private benefits of control. This new model predicts that many corporate finance variables each have opposing effects on under- and overinvestment. Private benefits exacerbate overinvestment...

The literature has documented positive announcement effects for privately placed seasoned equity issues. This study shows positive announcement effects not only for private but also for public placements in Hong Kong. Our unique data offer new insights not obtainable from U.S. data as we examine...

Financial ratios are important factors in predicting corporate failure. In this article, I propose to use an innovative statistics procedure to identify informative financial ratios and use those ratios to predict default rating. I use three types of different default-rating model to predict...

In a multivariate vector autoregression framework, this article investigates the weak efficiency of the urban residential real estate market and the cause of weak efficiency. An error correction model is used to estimate long-term relationships among apartment prices and adjustment speed from...

This paper generalizes the Myers and Majluf (1984) model by introducing an agency cost structure based on private benefits of control. This new model predicts that many corporate finance variables each have opposing effects on under- and overinvestment. Private benefits exacerbate overinvestment...