Showing papers by "Mark H. Lang published in 2002"
TL;DR: In this article, the authors investigated the relation between cross listing in the U.S., with its resulting commitment to increased disclosure, and the information environment of non-U.S. firms.
Abstract: This paper investigates the relation between cross listing in the U.S., with its resulting commitment to increased disclosure, and the information environment of non-U.S. firms. We find that firms that cross-list on U.S. exchanges have greater analyst coverage and increased forecast accuracy relative to firms that are not cross listed. A time-series analysis shows that the change in analyst coverage and forecast accuracy occurs around cross listing. We also document that firms that have more analyst coverage and higher forecast accuracy have a higher valuation. Further, the change in firm value around cross listing is correlated with changes in the firm's information environment. Our findings support the hypothesis that cross-listed firms have better information environments, which are associated with higher market valuations.
834 citations
TL;DR: This article examined whether cross-country differences in earnings-to-price multiples have changed between 1987-1992 and 1994-1999 and found that earnings multiples became more similar over this time period for the jurisdictions they analyzed, although systematic differences remain.
Abstract: We examine whether cross‐country differences in earnings‐to‐price multiples have changed between 1987–1992 and 1994–1999. Our results suggest that earnings multiples became more similar over this time period for the jurisdictions we analyze, although systematic differences remain. Economic determinants of earnings multiples (e.g., growth rates, interest rates, and returns) do not exhibit similar convergence and do not appear to explain the changes. The convergence is robust to controls for cash flow multiples and is apparent in the valuation of accruals. Accrual/cash flow correlations have also become more similar and generally less negative, suggesting a reduction in earnings smoothing. Overall, our evidence suggests convergence in accounting practice.
155 citations
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TL;DR: In this paper, the authors find that employee stock option deductions lead to large aggregate tax savings for Nasdaq 100 and S&P 100 firms and also affect corporate marginal tax rates.
Abstract: We find that employee stock option deductions lead to large aggregate tax savings for Nasdaq 100 and S&P 100 firms and also affect corporate marginal tax rates. For Nasdaq firms, the median marginal tax rate is 31 percent when option deductions are ignored but falls to 5 percent when one accounts for the deductions. For S&P firms, however, option deductions do not affect marginal tax rates to a large degree. In the spirit of DeAngelo and Masulis (1980), option deductions are important nondebt tax shields that can affect corporate policies. We find evidence consistent with option deductions substituting for interest deductions in corporate capital structure decisions. This evidence explains in part why some firms appear to be underlevered.
5 citations