This paper studies the role of voluntary disclosure in crowding out independent research about firm value. In the model, when inside firm owners make it easier for outside investors to obtain inexpensive biased information from the manager, then investors rely less on costly unbiased research....

In this paper, we evaluate the effect of managerial entrenchment on corporate information production using the voting outcomes of shareholder-initiated proposals intended to mitigate managerial entrenchment. We focus on the proposals that are passed or rejected by a small margin of votes, which...

We examine the influence of behavioral characteristics on the design of debt covenants. We find that firms with overconfident CEOs face tighter restrictions on their ability to make future investments, acquisitions, and raise additional debt financing. These restrictions are partially mitigated...

Through close interactions with their CEO and CFO, independent directors as well as subordinate executives can assess the overconfidence of their CEO and CFO. We show that independent directors and subordinate executives trade on this assessment, albeit differently. Independent directors of a...

This study examines whether the celebrity or star status of a chief executive officer (CEO) affects the informativeness of his insider trades. Using three different measures to identify star CEOs in a sample of S&P 1500 firms, we find that trades of non-star CEOs predict future abnormal returns...

This study explores whether high-growth firms use accruals as a signal instead of a misleading device in seasoned equity offerings (SEOs). Using firms listed on the NYSE, AMEX, and NASDAQ from 1987 to 2010 as our sample and the subsequent 5 years of the sample firms to examine ex-post...

We test under what circumstances boards discipline managers and whether such interventions improve performance. We exploit exogenous variation due to the staggered adoption of corporate governance laws in formerly Communist countries coupled with detailed 'hard' information about the board's...

This paper investigates under what circumstances boards of directors fire CEOs and whether this action leads to better firm performance. We use unique and detailed data, covering 473 companies in the transition region, on boards’ actions, expectations and beliefs about CEO ability. We find...

We test under what circumstances boards discipline managers and whether such interventions improve performance. We exploit exogenous variation due to the staggered adoption of corporate governance laws in formerly Communist countries coupled with detailed ‘hard’ information about the...

We examine the relation between executive compensation and market-implied default risk for listed insurance firms from 1992-2007. Shareholders are expected to encourage managerial risk-sharing through equity-based incentive compensation. We find that long-term incentives and other share-based...