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...

In this international study, we explore the benefits of strong institutions (or the perils of weak institutions) through the lens of equity issuance. We posit that strong governance—e.g., rule of law, control of corruption and shareholder rights—does not necessarily confer benefits on the...

The COVID-19 pandemic has led to economic and health crises (“twin crises”) worldwide. Using a sample of firms from 74 countries over the period January to August 2020, we examine stock price reactions of multinational corporations (MNCs) and purely domestic companies (DCs) to the crisis. We...

We examine why corporate governance varies widely across countries and across firms, and why such variation matters. Using a proprietary database from Governance Metrics International on corporate governance practices across a large number of countries and firms for 2006-2011 and employing a...

We examine why corporate social responsibility (CSR) practices vary across countries and firms, and evaluate the value implications. Using a sample of 30,399 firm-year observations representing 4,279 firms from 49 countries over the 2003–2015 period and applying hierarchical linear modeling,...

Building on Desai and Dharmapala’s (2006) complementarity theory on the relation between tax avoidance and insider diversion, we contribute to international research by examining the importance of tax avoidance to equity pricing, and the role that institutional environments play in shaping...

Using a sample of cross-listed firms from 51 countries and a difference-in-differences approach that exploits corporate governance shocks induced by cross-listing in the U.S., we find that firms tend to engage in less tax avoidance after cross-listing. This effect is more pronounced for firms...

We empirically investigate the effect of economic policy uncertainty (EPU) on corporate cash holdings using a large sample of international firms. EPU intensifies concerns of investors on managerial self-dealing and political extraction. Consequently, the potential cost of cash holdings (i.e.,...

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...