Local Governors’ Turnover and Firms’ Investment Comovement

The Comovement of Returns and Investment Within the Multinational Firm

Can financial integration, particularly the cross-border investments of multinational firms, help explain the synchronization of business cycles? This paper presents evidence on the comovement of returns and investment within U.S. multinational firms to address this question. These firms constitute significant fractions of economic output and investment in most large economies, suggesting that ...

Small Firms’ Investment:

Fund Turnover and Investment Performance

We examine the level of share dealing activity of UK long-term institutional funds and, for UK pension funds, assess the impact of this dealing activity on investment performance. The analysis is carried out using annual returns and activity from the WM Universe of UK funds. Previous published research has concentrated mainly on US mutual funds and has generally reported no relationship between...

Credit Rating Inflation and Firms’ Investment Behavior

Why do potentially inflated credit ratings affect rational, well-informed creditors’ bond investment decisions? What are credit ratings’ effects on firms’ behavior? We resolve these questions by modeling a credit rating agency (CRA) as a certified expert who transmits information to creditors with coordination incentives and dispersed beliefs. In the unique equilibrium, high credit ratings are ...

Research and Development Investment and Productivity Growth in Firms with Different Levels of Technology

I n the modern competitive world, Research and Development (R&D) and its overflowing technologies are the main basis of innovation, which in turn, can be determined as an important source of economic growth. Investing in research activities can help firms with different technological levels, especially high-tech industries to improve their productivity. This paper aims to analyze the...