How does a public announcement about a company exploring its potential sale or merger (“strategic alternatives”) affect the company and its shareholders? This study provides the first look at some of the positive and negative consequences to this unique disclosure of strategic alternatives....

This paper investigates the extent to which analysts incorporate tax-based earnings information into their earnings forecasts relative to other earnings information. We find that analysts' mis-reaction to tax-based earnings information is distinct from their mis-reaction to other (non-tax)...

In an economy where traders absorb information partially, we study the effect of disclosure accuracy and disclosure clarity on financial markets. Accuracy measures how precisely a disclosure identifies the firm's fundamentals, whereas clarity measures how well traders understand the disclosure....

In an economy where traders absorb information partially, we study the effect of disclosure accuracy and disclosure clarity on financial markets. Accuracy measures how precisely a disclosure identifies the firm's fundamentals, whereas clarity measures how well traders understand the disclosure....

I/B/E/S removes 6% of one-quarter-ahead earnings forecasts from the calculation of the consensus forecast. This study examines managers' role in these removals. We show optimistic forecasts are removed more often than pessimistic forecasts, after controlling for removal policies that I/B/E/S...

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....

This study investigates the impact of delegation structure of the top management team upon the quality of corporate voluntary disclosure on financial outcomes. The paper develops two competing hypotheses pertaining to the functional relationship between the degree of delegation and the...

This paper investigates the extent to which analysts incorporate tax-based earnings information into their earnings forecasts relative to other earnings information. We find that analysts' mis-reaction to tax-based earnings information is distinct from their mis-reaction to other (non-tax)...

We study firms' voluntary disclosures in a world of potential information leaks. We find that managers adapt their disclosure strategy to the likelihood and expected scope of leaks. An increasing likelihood fosters voluntary disclosure if leaks merely expose the manager's information endowment...

This article develops an agent-based model of security market pricing process, capable to capture main stylised facts. It features collective market pricing mechanisms based upon evolving heterogeneous expectations that incorporate signals of security issuer fundamental performance over time....