This paper examines the association between discretionary capital buffers, requirements, and risk for 99 largest European banks from 2013 to 2020. Discretionary buffers are banks’ own or headroom: difference reported required capital. Against backdrop of steadily increasing requirements over sample period, I exploit unique detailed Pillar 2 data that disclose since release a 2015 Banking Author...

This study presents the first targeted examination of changes in financial reporting surrounding the appointment of both new CEOs and Principal Financial Officers (PFOs). We identify companies that appoint new CEOs and PFOs in the period 1995 to 2002 and find that the change in discretionary accruals is negative and significant in the year of hire (from t-1 to t) for firms appointing a new CEO ...

BACKGROUND Improving the cost-effectiveness of health care requires an understanding of the genesis of health care costs and in particular the sources of cost variation. Little is known about how multiple physicians, caring collaboratively for patients, contribute to costs. OBJECTIVE To explore the effect of collaborative care by physicians on variation in discretionary costs in an intensive ...

Prior research has investigated the association between executive equity compensation and earnings management but the evidence is not conclusive. We investigate this question using the quantile regression approach which allows the coefficient on the independent variable (equity compensation) to shift across the distribution of the dependent variable (earnings management). Based on a sample of 1...

D iscussions of rules vs. discretion have occupied a central place in the analysis of macroeconomic policies in dynamic models. Costas Azariadis and Vincenzo Galasso have presented a new model that shows how a discretionary policy regime can lead to a more volatile fiscal policy than one pursued under a constitutional rule. They set up a simple fiscal policy story and examine the potential for ...

E agree about the goals of price stability, low unemployment and stable economic growth, but they disagree about the policies to achieve these goals. The disagreement is particularly heated over discretionary countercyclical Keynesian fiscal policy. After the poor macroeconomic performance of the 1970s and critical policy evaluations of the Keynesian approach— ranging from Robert E. Lucas and T...

This study analyzes the effect of managerial style on firm value by partitioning general and administrative (G&A) expenses in the REIT industry into a nondiscretionary “structural” component associated with the costs of asset and liability management and a discretionary or “style” component. The discretionary component is significantly related to at least one measure of stylespecifically, the p...