Most international stock exchanges distinguish solely between domestic and foreign issuers, whereas in Germany, issuers can choose between two market segments with diverse transparency levels: the Prime Standard and Non-Prime Standard segment. Transparency requirements for the Non-Prime Standard...

This study investigates the valuation effects and real effects of off-balance-sheet versus capitalization accounting. We consider a firm that chooses two types of investments that must be bundled to produce short-term and long-term returns. One type of investments requires periodic expenditures...

This paper proposes a theoretical model that incorporates corporate governance into the basic CAPM, where corporate governance affects the disutility of managerial effort and the possibility of managers to divert company resources. It shows that corporate governance affects firms’ stock...

When companies raise equity finance they have to make two choices: the issuing method (cash versus rights) and, when they choose the rights issue method, whether rights should be traded or not. We study these choices using a sample of 15,751 rights issues and 22,016 cash offers announced during...

When larger market values of equity result in being subject to costly regulation, firms have incentives to shift their sources of financing toward debt and away from equity. We use the Sarbanes-Oxley Act of 2002 (SOX) as a setting to provide evidence of such incentives. Smaller firms were...

When larger market values of equity result in being subject to costly regulation, firms have incentives to shift their sources of financing toward debt and away from equity. We use the Sarbanes-Oxley Act of 2002 (SOX) as a setting to provide evidence of such incentives. Smaller firms were...

In this paper, we ask how firms’ optimal debt structure responds to a change in the bankruptcy regime. While existing work shows that this relationship is dependent on the ex-ante liquidation value of a firm, we demonstrate that the ownership of lenders they are connected to also matters. We...

The purpose of this study is to investigate the impact of corporate internationalization, governance structures, and legal protections on the foreign earnings response coefficient (FERC). The FERC is a measure of the value-relevance of foreign earnings. We collected data on 3653 Taiwanese firms...

The question of whether the CEO should also serve as chairman of the board is one of the most hotly debated issues in the recent corporate governance discussion. While agencytheoretic arguments advocate a separation of decision and control functions, the empirical evidence focusing on U.S....

We derive and develop a simple and intuitive model that shines fresh light on the relentless debate over whether corporate ownership converges to the Berle-Means modern corporation with high stock ownership dispersion. Our model takes into account the importance of both protective legal...