This article identifies an important channel through which excess control rights affect firm value. Using a new, hand-collected data set on corporate ownership and control of 3,468 firms in 22 countries during the 1996–2008 period, we find that the cost of debt financing is significantly...

This paper examines the relation between a borrowing firm's ownership structure and its choice of debt source using a novel, hand-collected data set on corporate ownership, control and debt structures for 9,831 firms in 20 countries from 2001 to 2010. We find that the divergence between control...

This article investigates how the job histories of CEOs influence their capital allocation decisions when they preside over multidivisional firms. I find that, after CEO turnover, divisions not previously affiliated with the new CEO receive significantly more capital expenditures than divisions...

Weijian Shan, Managing Partner of Newbridge Capital, faces a tough call in regard to his firm's investment in Shenzhen Development Bank, China's fifteenth largest commercial bank listed on the Shenzhen Stock Exchange. Due to the aggressive lobby of the existing management at the bank, the...

This paper examines the influence of directors' job security on firms' innovation project choices.Using the staggered enactment of majority voting legislation as an exogenous threat to directors'job security, we find that after legislative changes, the affected firms produce fewer...

We analyze how direct employee voice affects financial leverage. German law mandates that firms' supervisory boards consist of an equal number of employees' and owners' representatives. This requirement, however, applies only to firms with over 2,000 domestic employees. We exploit this...

This paper studies how mandating employers to provide health insurance of a minimum quality and the associated increases in health insurance premia affect firm employment and performance. To do so, we use hand-collected firm-level employee health insurance data. We find that employers with...

This paper demonstrates the tacit benefits that accrue to both politicians and the firms to which they are connected through stock ownership. Specifically, we show strong evidence that politicians use private information and political favors for financial gains from stock investments in their...

This paper investigates how executive employment contracts influence corporate financial policies during the final year of the contract term, using a new, hand-collected data set of CEO employment agreements. On the one hand, the impending expiration of fixed-term employment contracts creates...

There is a strong link between measures of stock market performance and subsequent equity issues. We find that management turnover weakens the link between equity issues and the returns that preceded the new CEO. Moreover, there is a discontinuity in the distribution of equity issues around the...