This paper studies the relationship between companies' choice of capital structure and their stock market returns from a corporate governance perspective. A portfolio buying low-levered, zero payout stocks and selling high-levered, zero payout stocks earned abnormal returns of 8.5% per year from...

This study investigates the market response to the requirement that the principal executive and financial officer of an SEC registrant each state under oath that the firm's annual and quarterly financial reports are materially accurate and complete pursuant to the Securities Exchange Act of...

We analyze a sample of 330 firms making unaudited disclosures required by Section 302 and 383 firms making audited disclosures required by Section 404 of the Sarbanes-Oxley Act. We find that Section 302 disclosures are associated with negative announcement abnormal returns of -1.8 percent, and...

This article analyzes the manifold situations in which the efficient-market hypothesis (EMH) has influenced—or has failed to influence—federal securities regulation and state corporate law, and the prospective roles for the EMH in these contexts. In federal securities regulation, the EMH has...

We survey the textual sentiment literature, comparing and contrasting the various information sources, content analysis methods, and empirical models that have been used to date. We summarize the important and influential findings about how textual sentiment impacts on individual, firm-level and...

This study investigates the endogenous relationship between abnormal insider trading and accrual abuse, and explores whether corporate governance affects this relationship. Our results suggest that insiders take advantage of private information on abnormal accruals to time their trading and...

This paper examines whether the increased legal and reputational constraints associated with cross-listing in the U.S. reduces the propensity of insiders to trade on private information. We find that the directors in both domestic and cross-listed firms trade on private information, particularly...

This paper analyzes market reactions triggered by announcements that hedge funds and private equity investors have purchased large blocks of voting rights. We argue that changes in shareholder wealth are related to the opportunity, possibility, and motivation of being an active blockholder who...

This paper examines the economic relevance of the factors set forth under Section 408 of the Sarbanes-Oxley Act to guide the enhanced regulatory scrutiny of public company financial disclosures, as required under the Act. We interpret two of the factors, volatility and firm size, as predictors...

This paper analyzes market reactions triggered by announcements that hedge funds and private equity investors purchase large blocks of voting rights. We argue that changes in share-holder's wealth are related to the opportunity, possibility and motivation of being an active blockholder, who...