Albert Banal-Estanol, Gyöngyi Lóránth, and David Pothier ♦ We study how resolution regimes affect investment in banking groups with subsidiaries of varying financial strength. Centralized regimes that preserve the group’s structure enable ex post support for weaker units but may…
Jie Chen, Xunhua Su, Xuan Tian, Bin Xu, Xiaoyu Zhang ♦ We examine the efficacy of product market discipline as a deterrent to corporate misconduct. Firms that are subject to greater competitive threats in the product market are less likely…
Wen Chen, Bo Hu, and Yajun Wang ♦ We study how asset managers’ benchmarking affects market efficiency under two learning technologies: separative and integrative. With integrative learning, investors process portfolio-wide signals, optimizing information allocation across assets instead of focusing on individual…
Allen N. Berger, Narjess Boubakri, Ruiyuan Chen, Omrane Guedhami, and Xinming Li ♦ Building on existing views of state ownership, we examine the impact of banks’ privatization on their liquidity creation, a comprehensive measure of net bank output from all…
Meng Gao ♦ This paper uses a regression discontinuity design to identify the effect of compensation shocks on insider trading. I find that CEOs who narrowly miss relative performance goals and hence suffer a loss in compensation subsequently earn higher…
Alexander David and Amel Farhat ♦ We provide robust evidence that the price of analysts’ disagreement risk in the cross-section of stock returns changes sign; it’s positive (negative) in periods of high (low) disagreement. We construct a general equilibrium model in…
