We investigate Gompers, Ishii, and Metrick's (2003) finding that firms with weak shareholder rights exhibit significant stock market underperformance. If the relation between poor governance and poor returns is causal, we expect that the market is negatively surprised by the poor operating...

We investigate <link rid="b27">Gompers, Ishii, and Metrick's (2003)</link> finding that firms with weak shareholder rights exhibit significant stock market underperformance. If the relation between poor governance and poor returns is causal, we expect that the market is negatively surprised by the poor operating...

[...]We also concentrate our survey on literature that testseconomic hypotheses within samples of U.S. firms. However,we believe that much of our discussion can be generalized tofirms throughout the world. Bushman and Smith (2003)present a broad overview of how differences in...