In this paper, we examine how financial leverage and information quality interactively affect the equilibrium investment and effort decisions, therefore affect overall efficiency. We find that when the financial leverage is in an intermediate range, overall efficiency may decrease in information...

In this study, we show that when a firm needs external financing, information quality has real effects via financing contracts on the firm's input to influence its operational outcome. Interestingly, we find that higher information quality decreases overall efficiency. Our analysis highlights...

We examine the corporate governance roles of information quality and the takeover market with asymmetric information regarding the value of the target firm. Increasing information quality improves the takeover efficiency, however, a highly efficient takeover market also discourages the manager...

This paper examines the impact of uniform standards from an economy's perspective in the presence of capital crunches and economic shocks. We show that converting to uniform standards benefits some economies but may be detrimental to other economies, and the impact is determined by the joint...

In this study, we show that when a firm needs external financing, information quality has real effects via financing contracts on the firm's input to influence its operational outcome. Interestingly, we find that higher information quality decreases overall efficiency. Our analysis highlights...

We examine information quality and financial leverage when an entrepreneur needs financing to undertake a risky project and his effort input affects the project’s outcome. We show that information quality and financial leverage interact to play active roles in both investment and effort...

In this paper, we investigate the effect of accounting biases on firms' financing decisions and the role of accounting biases in endogenous information quality. We show that in industries with generally low-profit prospects, a downward-biased accounting system performs better than a neutral...