Existing literature suggests that earnings and its forecasts provide stronger signal than dividends about firms' future performance. We test the signaling effects of earnings and dividends under a market setting which has 1) low informativeness of earnings due to concentrated family-shareholding...

The theory of financial intermediation assigns banks a unique role in the resolution of information asymmetry. Banks, in general, obtain private information about the borrower and the project during the screening of loan applicants and during the monitoring of loan recipients. Incumbent banks,...

This article relates interim financial reporting frequency in a multiperiod Kyle framework to securities prices, trading volume, market liquidity, and analysts' information acquisition expenditures. The model supports conventional wisdom that more frequent interim reporting improves the...

Motivated by the debate about globally uniform accounting standards, this paper investigates whether firms using US GAAP vis-a-vis IAS exhibit differences in several proxies for information asymmetry. The study exploits a unique setting where the two sets of standards are put on a level playing...

Using audit trail data for a sample of NYSE firms, we show that medium size trades are associated with a disproportionately large cumulative stock price change relative to their proportion of all trades and volume. This result is consistent with the predictions of the stealth-trading hypothesis...

We develop a multi-asset trading model to examine the closed-end fund discount. The model shows that the discount can arise if the quality of private information in the underlying assets is sufficiently better than in the fund. The model also indicates that a discount (premium) can arise if the...

We compare underwriting performance by commercial bank-affiliated firms (Section 20's) and traditional investment banks over the period 1995-98. We find that gross spreads are lower in the case of Section 20 underwritings, but that yield spreads are not. Our sample includes a substantial number...

This paper investigates whether transparent markets can survive when faced with direct competition from less transparent markets. We first construct a game-theoretic model in which in equilibrium the low-transparency dealers capture early order flow, and use the resulting informational advantage...

We investigate whether CEOs manage the timing of their voluntary disclosures around scheduled stock option awards. Because stock options generally are awarded with a fixed exercise price equal to the stock price on the award date, we conjecture that CEOs manage investors' expectations around...

This paper assesses the importance of the role of prices as aggregators of private information in the Samp;P 500 futures market. We estimate primitive parameters of the Hellwig (1980) noisy rational expectations model, when both prices and terminal values are observable. The variance-covariance...