We argue that commodity input hedging is different from commodity output hedging. Output hedging can be detrimental to “sector play.” Furthermore, firms with market power that hedge outputs have incentives to over-produce and distort market prices. In rational markets such hedging will be...

Although complementarity between products and/or technologies of bidders and targets is considered a key driver of M\&A deals, many observed mergers are inefficient: Complementarity gains in actual mergers are lower than the gains that could have been obtained were the targets acquired by...

This paper presents an industry equilibrium model where firms have a choice to engage in corporate social responsibility (CSR) activities. We model CSR as an investment to increase product differentiation that allows firms to benefit from higher profit margins. The model predicts that CSR...

This study investigates characteristics of individual crowdfunding practices and drivers of fundraising success, where entrepreneurs can tailor their crowdfunding initiatives better than on standardized platforms. Our data indicate that most of the funds provided are entitled to receive either...

We analyze firms' entry, production and hedging decisions under imperfect competition. We consider an oligopoly industry producing a homogeneous output in which risk-averse firms face an entry cost upon entering the industry, and then compete in Cournot with one another. Each firm faces...

This study examines the association between U.S. Census industry concentration measures and the informativeness of corporate disclosure policy. We find that in more concentrated industries firms' management earnings forecasts are less frequent and have shorter horizons, their disclosure ratings...

This paper presents an industry equilibrium model where firms have a choice to engage in corporate social responsibility (CSR) activities. We model CSR as an investment to increase product differentiation that allows firms to benefit from higher profit margins. The model predicts that CSR...

Major airlines rely on fuel hedging to manage risk of volatile fuel prices. We show that fuel hedging leads to lump sum gain or loss, which does not affect airlines' purchase cost of fuel (variable cost), but is incorporated into the reported airline fuel costs. Our estimation results suggest...

Although empirical studies show that common shareholding affects corporate conduct and that common horizontal shareholding lessens competition, critics have argued that the law should not take any action until we have clearer proof on the causal mechanisms. I show that we actually have ample...

Scholars and antitrust enforcers have raised concerns about anticompetitive effects that may arise when institutional investors hold substantial stakes in competing firms. Their concern rests on empirical evidence that such common concentrated ownership is associated with higher prices and lower...