Does managerial entrenchment create or destroy shareholder value? This Article presents both theory and evidence that the answer to this question is not monolithic, but rather depends on factors that vary greatly with the macroeconomic climate, such as firm profitability, takeover frequency, and...

Equity risk premiums are a central component of every risk and return model in finance and are a key input in estimating costs of equity and capital in both corporate finance and valuation. Given their importance, it is surprising how haphazard the estimation of equity risk premiums remains in...

The CAPM is commonly used for an introduction of the equity cost in practice to calculate the corporate value, which is composed by the risk-free rate, equity market return and each respective beta. However, there is a fundamental complication between the risk, cost and return for the equity...

We estimate a model of damage to corporate earnings from COVID-19. A pandemic decreases earnings due to costly mitigation and lower growth rates. The arrival of a vaccine, modeled as a Poisson process, reverts earnings to normal. We fit our model to timely measures of expected damage given by...

This paper examines how the quality of firm information disclosure affects shareholders' use of dividends to mitigate agency problems. Managerial compensation is linked to firm value. However, because the manager and shareholders are asymmetrically informed, the manager can manipulate the firm's...

Which legal, political, and economic institutions are shaping privatization processes in the world? This paper addresses the issue, presenting new evidence for a sample of 49 countries. From an empirical analysis for the period 1977-96, the decision to privatize appears to be influenced by...

Using new data from the two U.S. securities information processors (SIPs) between August 6, 2015 and June 30, 2016, we examine claims that high-frequency trading (HFT) firms use direct feeds to exploit traders who rely on SIP prices. Across $3.7 trillion of trades, the SIPs report quote updates...

This document contains supporting materials for the article "How Rigged Are Stock Markets? Evidence from Microsecond Timestamps" by Robert P. Bartlett, III and Justin McCrary.The paper to which this Appendix applies is available at the following URL: "https://ssrn.com/abstract=2812123"...

This paper presents a positive model which shows that institutional setups on capital and labor markets might be intertwined by politicoeconomic forces. Two politicoeconomic equilibria arise from our model, one with little protection of insiders on capital and labor markets, and another one with...