Annual Conference

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Accounting

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May 2017

Naughty Firms, Noisy Disclosure

Guoman SHE, Alminas ZALDOKAS, Thomas BOURVEAU
We empirically study how collusion in the product markets affects firms’ financial disclosure strategies. By exploiting exogenous variations to the costs of illegal pricefixing, we find that U.S. firms start sharing more detailed information in their financial disclosure about their customers, con...
Keywords: Voluntary Disclosure, Antitrust Enforcement, Collusion, Tacit Coordination
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Annual Conference

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Corporate Finance

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May 2017

The Dollar Profits to Insider Trading

Peter CZIRAKI, Jasmin GIDER
This paper studies insider trading quantities and dollar profits to measure the benefits insiders extract from their superior information. Dollar profits are economically small for a typical insider, the median insider earning $464 per year. The correlation between dollar profits and percentage retu...
Keywords: insider trading, trading profits, Corporate governance, executive compensation
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Annual Conference

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Investment Finance

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May 2017

Persistent Blessings of Luck: Theory and an Application to Venture Capital

Lin William CONG, Yizhou XIAO
Persistent performance in venture capital is routinely interpreted as evidence for skill. We present a dynamic model of delegated investment with endogenous fund heterogeneity and deal flow, which generates performance persistence without skill differences and predicts mean reversion in long-term pe...
Keywords: contracting, Deal Flows, Delegated Investment, Entrepreneurial Finance, Managerial Skill, Moral Hazard, private equity, Venture Capital
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Annual Conference

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Corporate Finance

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May 2017

Politically Motivated Corporate Decisions: Evidence From China

David FELDMAN, Konark SAXENA, Jiaming LI
Every five years Chinese province heads compete for promotions to the national congress by demonstrating superior economic performance. We document pervasive cyclicality in corporate decision-making synchronized with these promotion cycles: taxes firm’s pay are 4.1% higher one year before national...
Keywords: Politically Motivated Corporate Decisions, Corporate Investments, Taxes, Agency, China
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2017

Politicizing Consumer Credit

Pat AKEY, Rawley Z. HEIMER, Stefan LEWELLEN
Powerful politicians can interfere with the enforcement of regulations. As such, expected political interference can affect constituents’ behavior. Using rotations of Senate committee chairs to identify variation in political power and expected regulatory relief, we study powerful politicians’ e...
Keywords: Consumer credit, political interference, political power
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