This paper examines whether firms benefit, in debt contracting, from committing to incorporate future GAAP changes (referred to as rolling GAAP) or not to incorporate any future changes (referred to as frozen GAAP). We show that informative future accounting changes do not necessarily improve...

Privatization of services that were formerly provided by governmental agencies has been an important issue for both local and national governments. The purpose of this paper is to examine the issue of privatization in the context of the provision of a public good such as street cleaning and...

We examine the issue of privatization of those public goods that can be provided in-house or contracted out. Such privatization appears straightforward, yet history shows otherwise. For example, the private contracting system for street cleaning in 19th-century New York City was a failure,...

This study focuses on the relation between current compensation and past performance measures as signals of a CEO’s ability. We develop a simple two-period principal-agent model with moral hazard and adverse selection and test theoretical predictions using CEO compensation data from 1993-2006....

We examine the spillover effect of fraud allegations against Chinese companies that became public through reverse mergers (CRMs) instead of IPOs. Both short sellers and regulators took active interests in the frauds allegedly perpetrated by CRMs. Once the public became alarmed by the frequency...