For a sample of 1,866 privatizations from 37 countries, we estimate the impact of disclosure standards and legal institutions that discipline auditors on the method chosen to divest state-owned enterprises. The agency conflict between minority and controlling shareholders can impede a government...

We extend recent research on the links between political connections and financial reporting by examining the role of auditor choice. Our evidence that public firms with political connections are more likely to appoint a Big 4 auditor supports the intuition that insiders in these firms are eager...

The ownership structures of Western European firms engender agency conflicts between: (i) owners and managers (type I); and (ii) minority and controlling shareholders (type II). Prior research stresses that credible financial reporting ameliorates agency problems by identifying any diversion of...

The theory of prosocial organizational behavior predicts that target firms’ responsiveness can influence how whistleblowers perceive organizational justice. This responsiveness also affects whistleblowers’ willingness to undertake what is referred to as “extra-role” citizenship behavior....

We extend recent research on the links between political connections and financial reporting by examining the role of auditor choice. Our evidence that public firms with political connections are more likely to appoint a Big Four auditor supports the intuition that insiders in these firms are...

Building on rational choice institutionalism theory and Williamson's (2000) four-level social analysis framework, we investigate the influence of the informal institution of social trust on debt contract design in an international setting. Using a sample of non-U.S. firms that issue bonds in the...

We investigate the role of ownership structure and investor protection in postprivatization corporate governance. We find that the government relinquishes control over time, mainly to the benefit of local institutions and foreign investors. We also show that private ownership tends to...

Motivated by recent research on the costs and benefits of political connection, we examine the cost of equity capital of politically connected firms. Using propensity score matching models, we find that politically connected firms enjoy a lower cost of equity capital than their non-connected...

We analyze the importance of Internal Revenue Service (IRS) monitoring to equity pricing in U.S. public firms. Our evidence from large samples implies that equity financing is cheaper when the probability of an IRS audit is higher, enabling investors to learn more about the firm. Reflecting its...