The Czech Republic, Hungary and Poland followed different strategies in the use of nonstandard methods of privatization. In regard to resrirurion, the Czech Republic carried out physical return of property, Hungary weakly implemented financial compensation and Poland has not yet approved a programme. Management and employee buyouts were eschewed in the Czech Republic, took the form of employee ...

This paper analyses a longitudinal dataset on legal protection of shareholders over a 36 year period, 1970-2005 for four advanced countries, UK, France, Germany and the US. It examines two aspects of the legal origin hypothesis whether shareholder protection is higher in the common law countries (UK and USA) than in the civil law countries (France and Germany) and whether shareholder protection...

This paper empirically investigates whether or not banks charge higher loan spreads for having high capital ratios by using a dataset of all syndicated loans issued by public nonfinancial U.S. borrowers during the 1993 to 2007 period. We find convincing evidence that well-capitalized banks can indeed charge a ’spread premium’. We further investigate whether this result can be explained by banks...

Article history: Received 1 September 2013 Accepted 13 August 2014 Available online 20 August 2014 This paper investigates the link between firm headquarters location and its stock return co-movements in a full sample of Chinese listed firms from 1999 to 2007. The empirical results show a significant stock return co-movement pattern for firms located in the same province. And both firm-level fa...

We examine the role of information-based stock trading in affecting the risk-incentive relation. By incorporating an endogenous informed trading into an optimal incentive contracting model, we analytically show that, apart from reducing incentives, a greater risk increases the level of information-based trading which consequently enhances executive incentives and offsets the negative risk-incen...

In the Data Streaming world, screening for outliers is an often overlooked aspect of the data preparation phase, which is needed to rationalize inferences drawn from the analysis of data. In this paper, we examine the effects of three outlier screens: A Trimming Window, The Box-Plot Screen and the Mahalanobis Screen on the market performance profile of firms traded on the NASDAQ and NYSE. From ...

In the backdrop of the creation and collapse of the Cyprus stock market bubble, we document substantial positive abnormal returns around the announcement and execution of stock splits in Cyprus. Split-induced returns cannot be explained by variables proxying for conventional liquidity and signalling hypotheses for stock split activity, and are largely reversed in the post-split months. Post-spl...

While most research on hedging has focused on foreign currency exposures, analysis of jet fuel price exposure in the airline industry and the effects of both financial and operational hedging on this exposure provides valuable insights into risk management. Exposure and hedging in the airline industry is relatively straightforward compared to foreign exchange hedging by multinationals. We inves...

Recent empirical work using panel data documents that, while the correlation of investment and Tobin’s Q is low, the correlation of investment and credit spreads is high. We propose an explanation for these empirical findings, based on time-varying risk, i.e. stochastic volatility. In our model, firms finance investments using defaultable debt as well as equity issuance, and they are subject to...

Article history: Received 2 February 2012 Received in revised form 12 September 2012 Accepted 17 September 2012 Available online 24 September 2012 Dynamic panel models play a natural role in several important areas of corporate finance, but the combination of fixed effects and lagged dependent variables introduces serious econometric bias. Several methods of counteracting these biases are avail...