Annual Conference

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Accounting

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May 2017

Disclosure Frequency Induced Earnings-Cash Flow Conflict and the Decision to be Public

Vicki W. TANG, Kevin Ke LI
We examine whether disclosure frequency induced earnings-cash flow conflict influences the types of firms that choose to be public. Using the length of the cash conversion cycle to proxy for the disclosure frequency induced conflict between short-term reported earnings and total cash flows, we find ...
Keywords: managerial myopic behavior, mandatory disclosure frequency, earnings-cash flow conflict
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Annual Conference

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Corporate Finance

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May 2017

Do CEOs Deserve their Raises? Evidence from Stock Returns after Subjective Performance Reviews

Yiqing LU, Moqi GROEN-XU, Peggy HUANG
This paper studies the information content of CEO subjective performance reviews. We propose a novel proxy of positive reviews based on evidence of real CEO contracts: salary raises. It shows that performance review outcomes predict long-term stock returns. A long–short portfolio strategy that inv...
Keywords: subjective performance reviews, research and development, innovation, Stock Returns, Soft information
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Annual Conference

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Corporate Finance

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May 2017

Do Credit Card Companies Screen for Behavioral Biases?

Hong RU, Antoinette SCHOAR
Using granular data on the contract terms and design details of more than 1.3 million credit card offers, we document how card issuers shroud unappealing, back-loaded features of an offer (e.g., high default APRs, late or over-limit fees) via the position of the information, font size, or complexity...
Keywords: Credit card, Shrouding, Back-loaded
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Annual Conference

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Economic Transformation of Asia

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May 2017

Do Programs Mandating Small Business Lending Disincentivize Growth? Evidence from a Policy Experiment

Gursharan BHUE, Prasanna TANTRI, Nagpurnanand PRABHALA
Exploiting discontinuities in program eligibility, we show that mandates on banks to lend to small firms inhibit firm growth. Newly eligible firms near the upper threshold for treatment exhibit significant real-side slowdown in investment, sales, and a nonaccounting measure, power consumption. The e...
Keywords: Small Business Lending, firm growth
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2017

Do Term Premiums Matter? Transmission via Exchange Rate Dynamics

Mitsuru KATAGIRI, Koji TAKAHASHI
The macroeconomic effect of term premiums is a controversial issue both theoretically and quantitatively. In this paper, we explore the possibility that term premiums affect inflation and the real economy via exchange rate dynamics. For this purpose, we construct a small open economy model with limi...
Keywords: exchange rate, Term Premium, Uncovered Interest Rate Parity
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