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In this paper we analyze the resource allocation decision of a manager of a multi division firm whose compensation is based on the firms stock price. We find that internal investments exhibit a positive correlation across the firms divisions. In particular, when two divisions are put into one...
Persistent link: https://www.econbiz.de/10012752770
This paper examines how information becomes reflected in prices when investment decisions are delegated to fund managers whose tenure may be shorter than the time it takes for their private information to become public. We consider a sequence of managers, where each subsequent manager inherits...
Persistent link: https://www.econbiz.de/10012752777
A commonly held view in the financial and economic literature is that quot;free cash flow is badquot; in the sense that, given the opportunity, shareholders would always choose to minimize its existence. This view of the world has motivated economists such as Jensen (1988, 1993) to conclude that...
Persistent link: https://www.econbiz.de/10012753022
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This article analyzes whether political connections of the board of directors of publicly traded companies in the USA affect the allocation of government procurement contracts. It focuses on the change in control of both House and Senate following the 1994 election and finds that companies with...
Persistent link: https://www.econbiz.de/10010969513
This paper examines how information becomes reflected in prices when investment decisions are delegated to fund managers whose tenure may be shorter than the time it takes for their private information to become public. We consider a sequence of managers, where each subsequent manager inherits...
Persistent link: https://www.econbiz.de/10005302634
Persistent link: https://www.econbiz.de/10005362569
Persistent link: https://www.econbiz.de/10005362673
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