We estimate what percentage of firms engage in fraud and the economic cost of fraud. Our estimates are based on detected frauds, and frauds that we infer are started but are not caught. To identify the ‘iceberg' of undetected fraud we take advantage of an exogenous shock to the incentives for...

We construct a measure of the private benefits of control in 39 countries based on 412 control transactions between 1990 and 2000. We find that the value of control ranges between -4% and +65%, with an average of 14 percent. As predicted by theory, in countries where private benefits of control...

To identify the most effective mechanisms for detecting corporate fraud we study in depth all reported fraud cases in large U.S. companies between 1996 and 2004. We find that fraud detection does not rely on obvious actors (investors, SEC, and auditors), but takes a village of several...

We argue that profit-maximizing media help overcome the problem of quot;rational ignorancequot; highlighted by Downs (1957) and in so doing make elected representatives more sensitive to the interests of general voters. By collecting news and combining it with entertainment, media are able to...

We study the effect of media coverage on corporate governance by focusing on Russia in the period 1999-2002. This setting offers us three ideal conditions for such a study: plenty of corporate governance violations, no alternative mechanisms to address them, and the presence of an investment...

In this paper we discuss the role of the media in pressuring corporate managers and directors to behave in ways that are quot;socially acceptablequot;. Sometimes this coincides with shareholders' value maximization, others not. We provide both anecdotal and systematic evidence that media affect...

In this paper we discuss the role of the media in pressuring corporate managers and directors to behave in ways that are 'socially acceptable'. Sometimes this coincides with shareholders' value maximization, others not. We provide both anecdotal and systematic evidence that media affect...

We construct a measure of the private benefits of control in 39 countries based on 412 control transactions between 1990 and 2000. We find that the value of control ranges between 4% and +65%, with an average of 14 percent. As predicted by theory, in countries where private benefits of control...

We study the effect of media coverage on corporate governance by focusing on Russia in the period 1999-2002. This setting offers us three ideal conditions for such a study: plenty of corporate governance violations, no alternative mechanisms to address them, and the presence of an investment...

We argue that profit-maximizing media help overcome the problem of quot;rational ignorancequot; highlighted by Downs (1957) and in so doing make elected representatives more sensitive to the interests of general voters. By collecting news and combining it with entertainment, media are able to...