We develop a novel 10-K text-based model of product life-cycles and examine firm investment policies. Conditioning on the life cycle substantially improves the explanatory power of investment-Q models, and reveals a natural ordering of investments driven by the product life cycle. Firms...

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...

Partial ownership of stock in multiple competing firms is an important scholarly and policy topic in both corporate and antitrust law. Until now, the discussion has focused on ownership. This essay shifts the debate from a focus on common ownership to a focus on common control. No prior work has...

This paper contributes to the emerging literature on the effect of religion on corporate decision making and financial reporting. We argue that financial statement analytical tools could violate several commands of the Islamic law. Specifically, traditional liquidity ratios imply undervaluation,...

This book presents a new approach to the valuation of capital asset investments and investment decision-making. Starting from simple premises and working logically through three basic elements (capital, income, and cash flow), it guides readers on an interdisciplinary journey through the...

The question of whether and how partial common-ownership links between strategically interacting firms affect firm objectives and behavior has been the subject of theoretical inquiry for decades. Since then, the growth of intermediated asset management and consolidation in the asset-management...

Evidence from a wide sample of Italian private firms shows that cash holdings are significantly related with smaller size, higher risk and lower effective tax rates, therefore supporting predictions from the trade-off model. More cash is also held by firms with longer cash conversion cycles and...

We model corporate liquidity policy and show that aggregate risk exposure is a key determinant of how firms choose between cash and bank credit lines. Banks create liquidity for firms by pooling their idiosyncratic risks. As a result, firms with high aggregate risk find it costly to get credit...

This study examines the motivations for seasoned equity offering and the decomposition strategy that breaks the book-to-market ratio into misvaluation and growth components. In logit-based tests, we find strong support for the misvaluation explanation, which predict that firms issue when...