Annual Conference

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Corporate Finance

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May 2016

Influencing Control: Jawboning in Risk Arbitrage

Tao LI, Wei JIANG, Danqing MEI
In an 'activist risk arbitrage,' a shareholder attempts to improve terms of an announced M&A through public campaigns. Activists target deals with low premiums and those susceptible to managerial conflicts of interest, including going-private deals and deals in which CEOs receive outsized paymen...
Keywords: Activist Risk Arbitrage, M&A, Governance
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2016

Bribes and Firm Value

Stefan ZEUME
I exploit the passage of the U.K. Bribery Act 2010 as a shock to U.K. firms’ cost of doing business. Around the Act’s passage, U.K. firms operating in high-corruption countries experience a drop in firm value, while their non-U.K. competitors in these countries encounter an increase. U.K. firms ...
Keywords: valuation, Corruption, regulation, Corporate governance
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Annual Conference

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Corporate Finance

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May 2016

Anticorruption, Political Connections, and Corporate Cash Policy: Evidence from Politician Downfalls in China

Xiaofeng ZHAO, Haohan REN
We examine how firms change their cash policies in response to the downfall of corrupt politicians in China. We find that firms connected to their local government increase cash holdings when high-profile politician downfalls occur in the government. Consistent with the precautionary saving argument...
Keywords: Anticorruption, politician downfalls, Political Connections, Cash Policy
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Annual Conference

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Corporate Finance

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May 2016

Assortative Matching in Managerial Labor Markets: Theory and Measurement

Egor MATVEYEV
This paper provides evidence on the importance of complementarities in production within executive teams. Using data on top managers in large U.S. firms, I find that the managerial labor market is characterized by the high degree of within-firm positive sorting, which implies that better managers ar...
Keywords: Managerial talent, complementarities in production, assortative matching, executive compensation, director compensation, structural estimation
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Annual Conference

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Corporate Finance, Senior Fellows/Fellows

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May 2016

Anti-Corruption Reforms and Shareholder Valuations: Event Study Evidence from China

Randall MORCK, Bernard YEUNG, Chen LIN, Xiaofeng ZHAO
Chinese share prices rose sharply on the Politburo's Dec. 4th, 2012, announcement of its Eight-point Regulation, an uncharacteristically detailed and concrete Party policy, initiating an extensive anti-corruption campaign and announced surprisingly soon after a change in leadership. The reaction is ...
Keywords: Anti-Corruption, Marketization, Bribery Intensity, Firm Value
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