This article investigates the determinants of large changes in stock prices. Empirical evidences suggest that the asymmetry phenomenon in determinants of large changes in stock prices is found in three stock exchanges. In the New York Stock Exchange (NYSE), momentum effect accounts for most of...

Post-issue stock underperformance is driven, at least in part, by young issuers with contemporary decline in idiosyncratic risk (proxied by expected idiosyncratic volatility) exposure. We show that the SEO long-run underperformance primarily occurs in young issuers. The intuition is that young...

We study whether bank CEO optimism (optimistic bank) plays a role in technological progress. We find that optimistic banks lend more to smaller/riskier firms and charge higher loan spreads to compensate for the higher risk exposures. More interestingly, these optimistic banks prefer lending to...

Our paper examines whether investor opinions expressed in social media predicted stock returns of financial firms during the 2007-2009 global financial crisis. We conduct a textual analysis of the articles published on the stock market insight website Seeking Alpha before the crisis and find...

Using a novel dataset of firm-level perceived trustworthiness from the news media and social media, we find that lending banks charge significantly higher loan spread on firms with lower trustworthiness. Loans to these firms also tend to have shorter loan maturities, more financial covenants,...

We analyze whether the disaggregation quality (DQ) of a borrower's financial statement is associated with its bank loan pricing. We find that firms with low DQ have high bank loan spreads and total cost of borrowing. These results are more pronounced for risky and poorly governed firms....

We identify the endogenous social effects proposed by Manski (1993) in firm R&D spending. By using state-level Uniform Trade Secrets Act (UTSA) enactments as exogenous shocks, we find that focal firms respond positively to peers' R&D expenditure. The results suggest that managerial learning and...

We examine whether rival CEOs’ overconfidence influences a focal firm’s research and development (R&D) expenditure. We propose a stylized model based on an R&D competition game with CEOs having a keeping-up-with-the-Joneses preference. Our model predicts that the overconfidence level of...