Recent research documents the phenomenon of sticky cost behavior where costs change asymmetrically between an increase and a decrease in sales and attributes this behavior to managers’ deliberate decisions. In this paper, we test the relationship between sticky cost behavior and equity...

In recent years, life insurers have increased their exposure to socially controversial bonds from alcohol, tobacco, and gaming sectors, which contradicts social-norm constraints of such institutional investors. We show empirically that the practice of investment delegation contributes to the...

We hypothesize that managers who receive high equity-based compensation have greater incentive to avoid ownership dilution by timing their seasoned equity offers to periods when investors temporarily overvalue their stock. We provide empirical support for this hypothesis using a measure of...

We analyze the changes in cash holding policies of S&P 500 firms from before to after their inclusion in the index. One year after inclusion, their mean industry-adjusted cash holdings decline by nearly 32% from the year before inclusion. Several factors explain this decline. The precautionary...

This paper analyses a game theoretic model of tax competition in a system where tax authorities are revenue optimisers and countries are differentiated by size. The model accommodates more than two countries. In equilibrium, larger countries set higher tax rates non-cooperatively. By applying...