This paper examines the effect of firm crash-risk exposure on the speed of leverage adjustment (SOA), and how this … years 1989 to 2009. We find that firms exposed to a higher crash risk tend to adjust their financial leverage toward their … association between crash-risk exposure and leverage adjustment is attenuated by strong information environments at country level …

convexity results in a 21% increase in a firm's crash risk after controlling for managerial price-increasing incentives. In … positive jump risk. We exploit an exogenous shock to compensation convexity, arising from a change in the expensing treatment … suggest that managerial equity compensation portfolios do not augment a firm's future idiosyncratic crash risk because they …

We suggest that banks contribute extensively to systemic risk only if they are both “risky” and centrally placed in the … financial network. To calculate systemic risk we apply the ∆CoVaR measure of Adrian and Brunnermeier (2016) and measure … important determinant of systemic risk but primarily not by its direct effect. Rather, its main influence is to make other firm …

This study investigates the effect of corporate hedging on stock price crash risk. We test two competing hypotheses …. Under the transparency hypothesis, hedging reduces a firm's information asymmetry and lowers crash risk. Under the opacity … hypothesis, hedging decreases financial reporting quality and increases crash risk. Using a comprehensive sample of firms from …

stock price crash risk puzzle, for which a sound explanation remains elusive. Our conclusions offer avenues for future …

a financial system. With a static model on financial institutions' risk-taking behavior, we quantify the impact on … systemic risk in the cross-sectional dimension when imposing a capital requirement. Although imposing a capital requirement can … lower individual risk, it enhances the systemic linkage within the system at the same time. With a proper systemic risk …

the impact of micro-prudential regulation on the systemic risk in a cross-sectional dimension. We construct a static model … for risk-taking behavior of financial institutions and compare the systemic risks in two cases with and without a capital … requirement regulation. In a system with a capital requirement regulation, the individual risk-taking of the financial …

The paper investigates the role of CEO's equity and risk incentives in boosting securitization in the financial … industry and in motivating executives to reduce the perceived risk while betting on it. Using a sample of US financial … securitization transactions to a larger extent than CEOs with low incentives. We also show that CEOs with high equity and risk …