Journal ArticleDOI
R2 around the world: New theory and new tests
Li Jin,Stewart C. Myers +1 more
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TLDR
This article showed that lack of transparency increases R2 by shifting firm-specific risk to managers and that opaque stocks with high R2s are also more likely to crash, that is, to deliver large negative returns.About:
This article is published in Journal of Financial Economics.The article was published on 2006-02-01. It has received 1468 citations till now. The article focuses on the topics: Corporate governance & Stock (geology).read more
Citations
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Buy and sell dynamics following high market returns: Evidence from China
TL;DR: In this paper, the authors provide a closer look at the trading dynamics which may give rise to the positive relationship between market trading volume and its lagged returns, showing that when previous market returns are high, investors with larger (smaller) average trade size increase their buy (sell) volume.
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Does Fixed Asset Revaluation Build Trust between Management and Investors
TL;DR: In this article, the authors examined whether fixed asset revaluation has an impact on the timeliness and relevance of information disclosed in financial reporting, and they found that, on average, fixed-asset revaluations have a positive effect on sustainability.
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Increasing return response to changes in risk
TL;DR: In this article, the authors present an argument and supporting evidence that investors' return response to risk is increasing in level of risk and explain the negative time-series correlation between risk and return.
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Does market microstructure matter for corporate finance? Theory and evidence on seasoned equity offering decisions
TL;DR: In this paper, a theoretical model and empirical analysis is presented to examine how market microstructure affects seasoned equity offering (SEO) decisions from the perspective of information production associated with market liquidity.
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Credible reforms and stock return volatility: Evidence from privatization
TL;DR: In this paper, the authors investigate how privatization affects stock return volatility and show that a credible privatization program that is maintained over time signals credibility, which reduces political risk and in turn volatility.
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Journal ArticleDOI
Theory of the firm: Managerial behavior, agency costs and ownership structure
TL;DR: In this article, the authors draw on recent progress in the theory of property rights, agency, and finance to develop a theory of ownership structure for the firm, which casts new light on and has implications for a variety of issues in the professional and popular literature.
Posted Content
Law and Finance
Rafael La Porta,Rafael La Porta,Florencio Lopez de Silanes,Florencio Lopez de Silanes,Andrei Shleifer,Andrei Shleifer,Robert W. Vishny,Robert W. Vishny +7 more
TL;DR: This paper examined legal rules covering protection of corporate shareholders and creditors, the origin of these rules, and the quality of their enforcement in 49 countries and found that common law countries generally have the best, and French civil law countries the worst, legal protections of investors.
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Risk, Return, and Equilibrium: Empirical Tests
Eugene F. Fama,James D. MacBeth +1 more
TL;DR: In this article, the relationship between average return and risk for New York Stock Exchange common stocks was tested using a two-parameter portfolio model and models of market equilibrium derived from the two parameter portfolio model.
Journal ArticleDOI
Law and Finance
TL;DR: In this article, the authors examined legal rules covering protection of corporate shareholders and creditors, the origin of these rules, and the quality of their enforcement in 49 countries and found that common-law countries generally have the strongest, and French civil law countries the weakest, legal protections of investors, with German- and Scandinavian-civil law countries located in the middle.
Journal ArticleDOI
Investor Protection and Corporate Governance
TL;DR: In this article, the authors argue that the legal approach is a more fruitful way to understand corporate governance and its reform than the conventional distinction between bank-centered and market-centered financial systems, and discuss the possible origins of these differences, summarize their consequences, and assess potential strategies of corporate governance reform.