Who Facilitated Misreporting in Securitized Loans?
This paper examines apparent fraud among securitized nonagency loans using three indicators: unreported second liens, owner occupancy misreporting, and appraisal overstatements. We find that around 48%...
View ArticleEnlarging the Contracting Space: Collateral Menus, Access to Credit, and...
Recent reforms across Eastern European countries have given more flexibility and information to parties to engage in secured debt transactions. The menu of assets legally accepted as collateral was...
View ArticleDo U.S. Firms Hold More Cash than Foreign Firms Do?
From 1998 to 2011, U.S. firms held more cash on average (but not at the median) than similar foreign firms (foreign twins) did. The average difference in cash holdings does not increase after 2008, and...
View ArticleDo Measures of Financial Constraints Measure Financial Constraints?
Financial constraints are fundamental to empirical research in finance and economics. We propose two tests to evaluate how well measures of financial constraints actually capture constraints. We find...
View ArticleAsset Pricing When Traders Sell Extreme Winners and Losers
This study investigates the asset pricing implications of a newly documented refinement of the disposition effect, characterized by investors being more likely to sell a security when the magnitude of...
View ArticleDisclosure Standards and the Sensitivity of Returns to Mood
We provide evidence that higher-quality disclosure standards are associated with stock returns that are less sensitive to noise driven by investors' moods. We identify return-mood sensitivity (RMS)...
View ArticleThe Fetal Origins Hypothesis in Finance: Prenatal Environment, the Gender...
We find that differences in individuals' prenatal environments explain heterogeneity in financial decisions later in life. An exogenous increase in exposure to prenatal testosterone is associated with...
View ArticleDividends as Reference Points: A Behavioral Signaling Approach
We outline a dividend signaling model that features investors who are averse to dividend cuts. Managers with strong unobservable cash earnings pay high dividends but retain enough to be likely not to...
View ArticleReputation Concerns of Independent Directors: Evidence from Individual...
This study examines the voting behavior of independent directors of public companies in China from 2004–2012. The unique data at the individual-director level overcome endogeneity in both board...
View ArticleEquity Market Misvaluation, Financing, and Investment
We estimate a dynamic investment model in which firms finance with equity, cash, or debt. Misvaluation affects equity values, and firms optimally issue and repurchase overvalued and undervalued shares....
View ArticleLooking in the Rearview Mirror: The Effect of Managers' Professional...
We track the employment history of over 9,000 managers to study the effects of professional experiences on corporate policies. Our identification strategy exploits exogenous CEO turnovers and...
View ArticlePolicy Uncertainty and Corporate Investment
Using a news-based index of policy uncertainty, we document a strong negative relationship between firm-level capital investment and the aggregate level of uncertainty associated with future policy and...
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