We examine empirically the impact of ex ante competitive threats from potential foreign rivals on bad news hoarding/disclosure decisions. We find that stronger antitrust enforcement around the world causes domestic U.S. firms to exhibit lower levels of stock price crash risk. This is consistent...

We study the equilibrium in the model proposed by Kyle in 1985 and extended that we consider a framework where the price pressure can be random. We also allow for a random release time of the fundamental value of the asset. This framework includes all the particular Kyle models proposed in the...

This paper empirically evaluates two possible sources of large takeover premiums: preemptive bidding and target resistance. We develop an auction model that features costly sequential entry of bidders in takeover contests and that encompasses both explanations. We estimate the model parameters...

Suppose the value of a firm is endogenously determined by a manager's costly effort. We call this manager a distinguished player if he also can trade shares of the firm on a market. Arbitrage-free asset pricing theory suggests that the equilibrium market price reflects the value increasing...

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, investors rely less on costly unbiased research. As a...

This paper investigates abnormal standardized returns (ASRs) after major corporate events. Dutta, Knif, Kolari, and Pynnonen (2018) have shown that the ASR t-test has superior size and power compared to traditional test statistics. Based on this new test statistic compared to traditional test...

Prior research finds that when investors receive credible bad news about a firm, they revise their valuations of that firm downward. We examine a setting where investors receive bad news about a firm and revise their valuations of that firm upward. Specifically, we find that when activist...

This study explores the impact of joint corporate asset restructuring decisions where firms sell an asset in order to fund a subsequent acquisition (selling-to-buy). We find that firms with asset sales are associated with increased acquisition probability. The effect is more pronounced for...

We find that powerful chief executive officers (CEOs) are associated with higher crash risk. The positive association between CEO power and crash risk holds when controlling for earnings management, tax avoidance, chief executive officer's option incentives, and CEO overconfidence. Firms with...

We identify a group of investors with a track-record of owning firms that undergo securities class action lawsuits. We hypothesize and find evidence that these investors are ineffective monitors of corporate management. Firms with a large proportion of these shareholders are at greater risk of...