We theoretically and empirically examine the role of international takeover markets in curtailing dominant shareholder moral hazard for firms with higher value-added from acquisitions. In equilibrium, such firms strategically list shares in the markets of their targets and voluntarily dilute...

One key water resource challenge that faces the eastern United States today is how to regulate water withdrawals by offstream users, while preserving the fair sharing philosophy of the common-law Riparian Doctrine. Traditionally, this doctrine requires that riparians (users owning land adjacent...

Purpose: The purpose of this paper is to analyze the relationship between carbon emissions and a firm’s cost of debt (COD) in the Indian context. Design/methodology/approach: The present study is based on the Indian firms who disclose their emissions data under the Carbon Disclosure Project...

Purpose: The purpose of this paper is to analyze the relationship between Certified Emission Reductions (CERs) information and a firm’s stock prices. Design/methodology/approach: The present study is based on 193 CERs announcements by Indian firms over a 13-year period 2005–2017. The event...

Merton [1987. A simple model of capital market equilibrium with incomplete information. Journal of Finance 42, 483-510] predicts that idiosyncratic risk should be priced when investors hold sub-optimally diversified portfolios, and cross-sectional stock returns should be positively related to...

We theoretically and empirically investigate the role of information on the cross section of stock returns and firms' cost of capital when investors face estimation risk and learn from noisy signals of uncertain quality. The resultant equilibrium is an information-dependent conditional CAPM. We...