-
Can higher federal funds rates control mortgage lending during periods of high inflation and high house prices? Finance Research Letters (IF 7.4) Pub Date : 2024-07-13 Mohammad Saiful Islam, Jascha-Alexander Koch
The U.S. is facing higher inflation since December 2020 along with higher house prices. After a sharp increase, house prices have started to decline very recently even more drastically – reminding us of the global financial crisis 2007–08. Rather late, from December 2021 onwards, the Fed started to increase the Fed funds rate. However, it is unclear whether the Fed funds rate can control bank lending
-
Population aging and corporate human capital restructuring Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Fenghua Xiao, Jinbo Wang, Huijun Li, Juan Yang
Herein, we examine how population aging influences corporate human capital structure adjustment. The results shows that population aging can upgrade corporate human capital structure, with artificial intelligence as a potential mechanism at work. These results remain valid under various robustness and endogeneity analyses.
-
The influence of shareholder ESG performance on corporate sustainability: Exploring the role of ownership structure Finance Research Letters (IF 7.4) Pub Date : 2024-07-09 Paolo Fiorillo, Gianluca Santilli
The increasing emphasis on Environmental, Social, and Governance (ESG) criteria has raised important questions about the role of shareholders in influencing corporate sustainability. Using an international sample of 5,182 companies, we find a positive association between corporate ESG performance and shareholder ESG performance, and this is robust to endogeneity issues. This effect is stronger when
-
Dot-com and AI bubbles: Can data from the past be helpful to match the price bubble euphoria phase using dynamic time warping? Finance Research Letters (IF 7.4) Pub Date : 2024-07-09 Marcin Potrykus
The article investigates the existence of a price bubble in the artificial intelligence market, employing the Generalised Supremum Augmented Dickey-Fuller test and dynamic time warping methodology. It proposes a method to detect the end of the price bubble euphoria phase, generating an average profit of close to 7 % over 5 days and over 10.5 % over 20 days, with almost 90 % effectiveness. The study
-
Audit committee personnel training and stock price crash risk Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Eun Hye Jo, Jung Wha (Jenny) Lee
This study examines whether audit committee personnel training decreases future stock price crash risk. Using a hand-collected Korean sample comprising 2,378 firm-year observations from 2018 to 2022, we find that audit committee personnel training reduces future stock price crash risk by lowering real earnings management and curbing overinvestment. Additionally, our findings are more pronounced for
-
Establishment of environmental tribunals and corporate outward investment behaviour Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 HouYang Du, Hang Guo
This paper examines the relationship between establishing environmental tribunals and corporate outward investment. Based on listed firms from 2006 to 2022, this paper adopts a difference-in-difference model to explore the effects and underlying mechanisms. The findings indicate that establishing environmental tribunals can promote corporate outward investment including the willingness, numbers and
-
Shattering the glass ceiling: Female leadership and acquisitiveness in family and nonfamily firms Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Barbara Sveva Magnanelli, Luca Pirolo, Elisa Raoli
This research investigates the impact of female CEOs on mergers and acquisitions (M&As) in family and nonfamily firms. With a sample of 165 Italian listed companies engaged in M&As from 2011 to 2016, the study explores whether CEO gender impacts on firm's acquisitiveness in family and nonfamily firms. Findings indicate that having a female CEO is associated with lower acquisitiveness overall. However
-
Environmental regulation and firms' trans-regional investment: Evidence from the implementation of the New Environmental Protection Law Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Xianhe Qu, Jie Xia
Most literary works delve into the environmental consequences of the New Environmental Protection Law, widely regarded as the most stringent ecological protection legislation ever enacted. This study examines the relationship between implementing the New Environmental Protection Law and the cross-regional investment activities of firms. This study utilizes a difference-in-differences methodology to
-
The price of firm-level information uncertainty Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Xi Wang, Chao Gao, Tianfu Wang
Firm-level uncertainty is difficult to measure in nature. We construct a new measure of firm-level information uncertainty based on uncertainty premium implied by earnings announcement returns. This new measure fundamentally differs from other firm-level uncertainty measures. We find that high-uncertainty firms outperform low-uncertainty firms by 9.59 % per annum on a risk-adjusted basis. Furthermore
-
The impact of judicial prejudice in bankruptcy on creditors and local financial development Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Xue Dong Dai, Lisi Niu
In this research, we explore the implication of judicial prejudice in bankruptcy for creditor interests and local financial market development. Based on prefecture-level data, we find compelling evidence that judicial prejudice leads to capital market frictions. Regions with stronger judicial prejudice have higher borrowing costs. Moreover, judicial prejudice is negatively related to local financial
-
Executive education level heterogeneity and corporate internal pay gap Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Shifei Zhao, Jianwu Liu, Guizhong Jiang
This research aims to explore the connection between executive education level heterogeneity and the corporate internal pay gap. The findings indicate that executive education level heterogeneity raises the corporate internal pay gap, and there is heterogeneity in the impact of executive education level heterogeneity on the corporate internal pay gap with different property rights and industry types
-
Currency tail risk measurement and spillovers: An improved TENET approach Finance Research Letters (IF 7.4) Pub Date : 2024-07-05 Shi He, Huijuan Yu, Zihao Luo, Jiahong Yan
Based on an improved TENET approach, this paper analyses the tail risk of 32 major global currencies and measures the tail risk spillover among these currencies using daily data. We find that (i) The tail risk of USD, EUR, GBP and JPY is relatively high, while CNY shows low risk with a continuous upward trend; (ii) The total tail risk connectedness of currencies declines over time, but spikes during
-
Can old sin make new shame? Stock market reactions to the release of movies re-exposing past corporate scandals Finance Research Letters (IF 7.4) Pub Date : 2024-07-04 Le Kang, Han Jiang, Ziye Zoe Nie, Hui Zhou
We study stock market reactions to the release of movies that re-expose past publicly known corporate scandals. Using a sample of 54 event firms featured in 23 movies, we find that these firms have significantly persistent negative abnormal returns following the movie releases. We posit that such negative reactions are associated with the adverse public perception of the firms induced by the scandal
-
Can the ‘good-bad’ volatility and the leverage effect improve the prediction of cryptocurrency volatility?—Evidence from SHARV-MGJR model Finance Research Letters (IF 7.4) Pub Date : 2024-07-02 Zhenlong Chen, Junjie Liu, Xiaozhen Hao
In recent years, cryptocurrencies have gained investor attention for their extreme volatility, but this has introduced financial risks that require accurate prediction models. Therefore, we propose the SHARV-MGJR model, which incorporates both ‘good-bad’ volatility, leverage effects, and current return information to enhance the accuracy of cryptocurrency market volatility predictions. Empirical results
-
A comment on the relationship between operating leverage and financial leverage Finance Research Letters (IF 7.4) Pub Date : 2024-07-02 Kristoffer Glover
Using a real options model, Sarkar (2020) recently demonstrated that operating and financial leverage are not necessarily substitutes. Once a firm is allowed to optimize their operating capacity (hence operating leverage), an increase in one could in fact lead to an increase in the other. Contrary to the claims made in Sarkar (2020), however, we demonstrate in this note that appealing to a firm’s capacity
-
Portfolio selection via high-dimensional stochastic factor Copula Finance Research Letters (IF 7.4) Pub Date : 2024-06-28 Zhenlong Chen, Jing Chang, Xiaozhen Hao
In the financial market, different assets typically exhibit time-varying asymmetric dependence in scenarios of rise and fall. To accommodate this feature, this article proposes a novel model, the Skew t stochastic factor Copula model, designed to accurately capture the skewness characteristic of each variable. We employ an expectation-maximization algorithm for variable clustering and demonstrate its
-
Policy synergy on stock price crash risk: An intergovernmental perspective Finance Research Letters (IF 7.4) Pub Date : 2024-06-27 Yinchao Liao, Jun Wang, Lei Liao, Xiaoyang Shu, Tao Peng
Both central and local government policies present implications for companies and investors. While several studies evidence that government policies shape corporate behaviors, few studies have explored them from an intergovernmental view. This research constructs a new measurement of intergovernmental policy synergy with text-based tools and reveals an inverted U-shaped relation between central-local
-
Quantitative easing and bank risk-taking: Evidence from the federal reserve's large-scale asset purchases Finance Research Letters (IF 7.4) Pub Date : 2024-06-26 Zheng Zhang, Wenxue Wang, Ciji Song
This study uses individual bank balance sheet data from the United States to investigate the effects of the Federal Reserve's large-scale asset purchases, which are commonly known as quantitative easing (QE), on bank lending standards and risk-taking behaviour. Covering all three phases of QE (QE1, QE2 and QE3), we find a consistent and significant reduction in bank lending standards during each phase
-
Financial contagion in cryptocurrency exchanges: Evidence from the FTT collapse Finance Research Letters (IF 7.4) Pub Date : 2024-06-26 Luca Galati, Alexander Webb, Robert I. Webb
To what extent does the collapse of a digital token spread contagion across cryptocurrency markets? How do markets incorporate information in this turbulent setting? We examine contagion effects across major digital exchanges during the collapse of the FTX exchange and its token, FTT. We find evidence of contagion across crypto exchanges. We also examine the information cascade effects of other crypto
-
A simulated electronic market with speculative behaviour and bubble formation Finance Research Letters (IF 7.4) Pub Date : 2024-06-26 Nicolas Cofre, Magdalena Mosionek-Schweda
This paper presents an agent-based model of an electronic market with two types of trading agents. One type follows a mean reverting strategy and the other, the speculative trader, tracks the maximum realized return. Our research provides synthetic datasets of the order book (level 3) to study its dynamics under different levels of speculation. Inspired by the GameStop trading frenzy, we study the
-
Are Bitcoin option traders speculative or informed? Finance Research Letters (IF 7.4) Pub Date : 2024-06-26 Wang Chun Wei, Dimitrios Koutmos, Min Zhu
Are Bitcoin option traders speculative or do they have an informational advantage over the market? We explore this question using tick data from Deribit, one of the largest cryptocurrency option exchange platforms. Compared to other option platforms, Deribit is largely unregulated and makes for an ideal testing ground for this question. This is because if there are traders who possess privileged information
-
The asymmetric effects of upside and downside risks in cryptocurrency markets: Insights from the LUNA and FTX crises Finance Research Letters (IF 7.4) Pub Date : 2024-06-26 Abuduwali Aibai, Jiansuer Julaiti, Shangde Gou
Unlike conventional studies on the risk dynamics of cryptocurrency markets, this paper innovatively distinguishes between good and bad volatility to more accurately measure the market's risk spillover under both good and bad shocks. By constructing a network of cryptocurrency market risk spillovers, we delve into the asymmetry between good and bad volatility in the context of risk spillover. Specifically
-
Measuring dynamic spillovers between crude oil and grain commodity markets: A comparative analysis of demand and supply shocks Finance Research Letters (IF 7.4) Pub Date : 2024-06-25 Guohua Ni, Houda HADJ CHERIF, Zhenling Chen
This study explores spillover effects between oil and grain markets in response to supply- and demand-side shocks using the TVP-VAR-DY approach. Spillover effects among markets are enhanced under both demand and supply shocks. Wheat consistently acts as the transmitter of shocks for both types of events. Furthermore, corn is transmitter of spillovers to other markets. In contrast, soybeans receive
-
Price discovery share: An order invariant measure of price discovery Finance Research Letters (IF 7.4) Pub Date : 2024-06-22 Shulin Shen, Syed Galib Sultan, Eric Zivot
To address the order-dependence issue in Hasbrouck’s (1995) Information Share (IS) measure, which assesses a market’s contribution to price discovery, we propose a new metric called the Price Discovery Share (PDS). The PDS is straightforward to compute, easy to interpret, order invariant, and unique. Our measure is inspired by a commonly used method in portfolio risk management that decomposes portfolio
-
Acting for good, being good or feeling good? Exploring factors influencing individual investors’ willingness to invest in green funds Finance Research Letters (IF 7.4) Pub Date : 2024-06-21 Fabrice Hervé, Sylvain Marsat
This paper empirically investigates the determinants of willingness to do good of green investment within a real-world context. Using data from a questionnaire administered between December 2021 and January 2022 to French individual investors, we find that “being good” (altruism) and “acting for good” (perceived impact) exert a substantial influence on both the decision-making process and the amount
-
A new perspective on how investor sentiment affects herding behavior in the cryptocurrency market Finance Research Letters (IF 7.4) Pub Date : 2024-06-20 An-Sing Chen, Huong Thi Nguyen
This study examines how news sentiment impacts herding (anti-herding) behavior in the cryptocurrency market. We categorize the cryptos into “clean” and “dirty” based on their energy consumption. The results show that news sentiment has divergent effects. When economic news positively overwhelms investors, herding becomes more apparent among the "clean" cryptocurrencies while the "dirty" exhibits more
-
Market-oriented debt-to-equity swap and enterprise financial performance Finance Research Letters (IF 7.4) Pub Date : 2024-06-20 Honglan Jiang
-
Industry and regional peer effects on company innovation Finance Research Letters (IF 7.4) Pub Date : 2024-06-19 Xingquan Yang, Feng Li, Ying Liu
Innovation is crucial for business development and economic growth. This study examines the significance of industry and regional peer effects on company innovation, the underlying motivations, and their economic consequences. We find industry and regional peer significantly affects company innovation. Instrumental variables method is used to confirm the robustness of the findings. We also find that
-
Does central bank transparency converge across the world? Evidence from a club convergence perspective Finance Research Letters (IF 7.4) Pub Date : 2024-06-13 Dinabandhu Sethi, Ujjwal Sharma, Alekha Meher
We study whether there is any evidence of convergence of central bank transparency in 112 countries from 1998 to 2019 using Phillips and Sul panel club convergence technique. The results don't find evidence of a single club convergence of central bank transparency. Instead, our result reveals four clubs converging to their unique transition path. Further, we found that countries with high financial
-
Exploring market efficiency levels: A powerful approach based on a gamma distribution Finance Research Letters (IF 7.4) Pub Date : 2024-06-12 Abolfazl Askari, Ehsan Hajizadeh
We introduce a novel measure to assess market inefficiency levels and examine their evolution over time using robust statistical principles. Our innovative approach not only facilitates a comprehensive exploration of market efficiency and its economic impacts but also allows for effortless comparisons across various assets, timeframes, regions, and data frequencies. Our findings reveal that during
-
Quantum and AI-based uncertainties for impact-relation map of multidimensional NFT investment decisions Finance Research Letters (IF 7.4) Pub Date : 2024-06-11 Hasan Dinçer, Serhat Yüksel, Jaehyung An, Alexey Mikhaylov
The purpose of this study is to identify the most essential determinants of NFT investments with a novel artificial intelligence based fuzzy decision-making model. First, the expert choices are prioritized with artificial intelligence methodology. Secondly, the criteria for multidimensional NFT investment decisions are weighted with Quantum picture fuzzy rough sets based DEMATEL. The findings denote
-
Monetary policy and innovation in Europe: An SVAR approach Finance Research Letters (IF 7.4) Pub Date : 2024-06-11 Gianni Carvelli, Eleonora Bartoloni, Maurizio Baussola
Using quarterly data, we estimate the effects of monetary policy on innovation in the Eurozone over 2000–2021. Variations in the monetary stance may affect how firms and governments allocate resources to innovative investments. The identification of the structural shocks relies on an SVAR framework with a set of exclusion restrictions. Although characterised by the predominance of ZLB periods, conventional
-
Foreign equity lookback options with partial monitoring Finance Research Letters (IF 7.4) Pub Date : 2024-06-08 Hangsuck Lee, Hongjun Ha, Byungdoo Kong
A lookback option on foreign equity reduces the uncertainty of foreign investment by delivering the benefit of hindsight. Despite its high marketability, purchasing the option is stalled due to the failure to meet customized demands. This paper proposes foreign equity lookback options with partial monitoring and floating strike price to control the option premiums. We establish the expected value of
-
Portfolio's weighted political risk and mutual fund performance: A text-based approach Finance Research Letters (IF 7.4) Pub Date : 2024-06-08 Huong Giang Nguyen, Khanh Hoang, Quan M.P. Nguyen, Hung Xuan Do, Duc Khuong Nguyen
Using text-based measures of firm-level political risk, we find a negative impact of the portfolio's weighted political risk on U.S. mutual fund performance. This relationship is robust to a wide range of topic-specific political risks at the firm level. We, however, find that national geopolitical risk, the U.S. state-level economic policy uncertainty, and Brexit-induced risk do not affect mutual
-
Customer structure and R&D investment: Based on innovative trait Finance Research Letters (IF 7.4) Pub Date : 2024-06-08 Wenxin Cui, Cuixia Qiao
This paper selects China's A-share listed companies in the manufacturing industry from 2017 to 2022 as a research sample to explore the relationship between customer structure and enterprise R&D investment. It is found that customer concentration has a significant negative impact on the R&D investment of manufacturing enterprises, and the mediating effect of enterprise financing constraints is significant;
-
Enterprises’ internationalization, R&D investment and enterprise performance Finance Research Letters (IF 7.4) Pub Date : 2024-06-06 Yanyu Fu
-
Public procurement and bank lending Finance Research Letters (IF 7.4) Pub Date : 2024-06-06 Anže Burger, Matej Marinč, Sašo Polanec, Patricia Kotnik
This article unveils that government is intertwined with banking through a hitherto underexplored channel—through public procurement. On a comprehensive firm-level dataset that combines public procurement and accounting data, we apply the difference-in-differences method to show that treated firms that secure a public procurement contract can strengthen their bank borrowing terms. Treated firms obtain
-
The impact of green finance and technology on the commercial banks’ profit and risk Finance Research Letters (IF 7.4) Pub Date : 2024-06-06 Zhiyi Zhou, Jing Tong, Haoyang Lu, Shouyi Luo
This paper investigates the impact of green credit on the performance and risk of Chinese commercial banks, and also explores the impact of green technology on this mechanism. The results show that for all banks, green loan balances have a significantly negative impact on net profit. While for large, small and medium sized banks, it also reduces and increases bank insolvency risk respectively. Therefore
-
The uncertainty of fluctuation correlations in global stock markets Finance Research Letters (IF 7.4) Pub Date : 2024-06-05 Faming Wang, Xueyun Rong, Lei Yin
Revealing the associations among stocks is fundamental for unveiling the underlying rules of global stock markets. In this work, we propose a combined entropy–complex network framework that detects fluctuation connections among stock prices. The results demonstrate that global stock markets show high uncertainty (high entropy). Based on our analysis of the system's symmetry and dominant correlation
-
ESG combined score effects on stock performance of S&P 500-listed firms Finance Research Letters (IF 7.4) Pub Date : 2024-06-03 Shi Cheng, Shan Huang
The influence of ESG combined scores on the stock performance (excess return, volatility, and liquidity) of S&P 500-listed firms was examined from June 2013 to May 2023. Ordinary least squares and heterogeneity analyses were used, with robustness checks performed through the use of endogenous treatment and fixed-effects models. Results indicated that ESG combined scores are negatively correlated with
-
Judicial reforms and corporate governance: The contribution of circuit courts to ESG performance improvement Finance Research Letters (IF 7.4) Pub Date : 2024-06-03 Yufei Xue, Sheng He
This study uses empirical data from Shanghai and Shenzhen A-share listed companies from 2010 to 2022 to examine the effects of circuit courts establishment on corporate environmental, social, and governance (ESG) performance of corporations. The findings show that circuit courts significantly enhance ESG performance, particularly in smaller private enterprises and in less-marketized regions. Analyst
-
Do transactions on social trading platforms predict the stock market behavior of the aggregate private sector? Finance Research Letters (IF 7.4) Pub Date : 2024-06-03 Matthias Horn, Julian Schneider, Andreas Oehler
We analyze the relation between virtual stock holding changes on a social trading platform and stock holding changes of all private investors in a national economy. Our data sources are the social trading platform com and the () of the German central bank. We find that the transactions of signal providers on are a good proxy for aggregate transactions of private investors – mirrored by the – during
-
The impact of director network distance on enterprise investment returns Finance Research Letters (IF 7.4) Pub Date : 2024-06-01 Xing Zhao, Ying Wang, Jieyu Li, Xiangqian Li
We use A-share listed firms in Shanghai and Shenzhen between 2011 and 2021 as a sample, and analyze the impact of director network distance on enterprise investment returns. The results show that the smaller the director network distance is, the more it helps to enhance enterprise investment returns. The inhibitory effect of director network distance on enterprise investment returns is significantly
-
Judicial local protection and corporate litigation outcomes: A study based on legal big data Finance Research Letters (IF 7.4) Pub Date : 2024-06-01 Aimin Li
-
Enterprise digital transformation empowers supply Chain stability Finance Research Letters (IF 7.4) Pub Date : 2024-06-01 Wenjuan Jiang, Xin Wang
We primarily investigate the influence of enterprise digital transformation on supply chain stability. It finds that digital transformation in enterprises enhances supply chain stability, with industrial structure adjustment playing a mediating role. Specifically, digital transformation in enterprises promotes industrial structure adjustment, thereby improving supply chain stability. Further heterogeneity
-
Measuring ESG risks in multi-asset portfolios: Decomposing VaRESG into CVaRESG Finance Research Letters (IF 7.4) Pub Date : 2024-06-01 Paolo Capelli, Federica Ielasi, Angeloantonio Russo
This study investigates the contribution of different asset classes to investment portfolio risk by integrating environmental, social, and governance (ESG) factors into traditional financial risk measures. We propose a new methodology for decomposing VaR by measuring the Component VaR (CVaR) of a multi-asset financial portfolio. A pilot empirical application's results provide evidence of the reliability
-
Digital finance and corporate environmental violations Finance Research Letters (IF 7.4) Pub Date : 2024-06-01 Fahad Khalid, Xinhui Sun, Rabia Akram, Mohit Srivastava
Using a sample of 1048 A-share listed firms for the period 2011–2020, we analyze the direct and indirect pathways through which digital finance shapes environmental governance mechanisms within corporations. Our findings reveal that digital finance mitigates environmental violations through information (internal control) and financial (environmental investment) mechanisms. The primary findings remain
-
Bankruptcy law and the leverage speed of adjustment Finance Research Letters (IF 7.4) Pub Date : 2024-06-01 Satish Kumar
-
How does digital collaboration impact supply chain resilience Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Lei Jia, Jing Li
In the context of dynamic business landscapes, this study explores the interplay between digital collaboration, government subsidies, and supply chain resilience. The results unveil a nuanced relationship: while digital collaboration exhibits a negative association with resilience, factors like higher leverage, state ownership, and larger company size positively influence resilience. Crucially, government
-
Mutual fund liquidity management and family affiliation Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Marius Popescu, Zhaojin Xu
The article investigates how fund family affiliation impacts the liquidity management of U.S. equity funds. We find that funds within large families use cash and sell their most liquid assets to meet redemption demand. In contrast, funds within small families maintain their cash balance and their most liquid assets. We also find that, in large fund families, funds with high (low) total fees tend to
-
Testing static and dynamic leverage models: A standardized leverage measure approach Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Wei He, Xuanlin Tang, Hanzhe Zeng
This paper proposes and validates a new measure of capital structure by normalizing firms’ leverage ratios by their business risks, assuming asset values follow a geometric Brownian motion. We empirically test the new measure with both static and dynamic leverage models, and we find that the standardized leverage () ratio: 1) performs similarly to book leverage in static leverage regressions, and 2)
-
Financial leasing and enterprise innovation Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Hanyu Lian
This paper selects the data of China's A-share listed enterprises from 2012 to 2022 as a research sample to explore the relationship between financial leasing and enterprise innovation. It is found that financial leasing positively affects innovation input and output; after enterprises use financial leasing to finance, it will alleviate the degree of financing constraints of enterprises and then promote
-
Incorporating weather information into commodity portfolio optimization Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Dongna Zhang, Xingyu Dai, Jianhao Xue
This study investigates the out-of-sample performance of commodity portfolios by incorporating weather information within the Black-Litterman framework. The inclusion of weather information increases returns, reduces downside risk for energy and agricultural portfolios, and diminishes volatility in agricultural portfolios. We find significant enhancement in the efficiency of energy and agricultural
-
Lingua franca proficiency and cross-border mergers and acquisitions: Language matters Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Yuanyuan Zhang, Wenli Sun, Yaning Du
The study explores the effect of lingua franca proficiency on cross-border mergers and acquisitions. Based on data from 2000 to 2019 in Zephyr database, we find that lingua franca proficiency measured by combined English score can promote cross-border M&As from deal value, deal number and success rate dimensions. Language output ability (writing and speaking skills) is more important that input ability
-
Payday alternative loans: PAL or Foe? Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Anna-Leigh Stone
Payday alternative loans (PALs) are small, short-term loans granted by federal credit unions. This paper examines the history of these loans, characteristics of credit unions that grant PALs, and how these loans impact credit risk. Credit unions with a low-income designation offer PALs and make a higher amount and number of PALs in terms of the loan portfolio. Credit unions that offer PALs have lower
-
From words to finances: Unraveling the negative net debt-languages nexus Finance Research Letters (IF 7.4) Pub Date : 2024-05-31 Marvelous Kadzima, Michael Machokoto, Tesfaye T. Lemma
Using an international dataset, we find that firms in countries with languages that lack a clear distinction between present and future tenses, leading to weaker future time references, are more likely to adopt negative net debt. This conservative and non-standard financing policy is notably pronounced among financially constrained firms, those with weaker governance, and those operating in highly
-
Corporate SDG performance and investor trading behavior Finance Research Letters (IF 7.4) Pub Date : 2024-05-29 Xinglong Yang, Zhang-HangJian Chen, Yujia Feng, Xiang Gao, Kees G. Koedijk
This paper employs a novel sustainability rating from Robeco to examine the response of investors to firms’ SDG performance. We explore the underlying mechanism from the perspective of corporate reputation and financial performance. Our finding suggests that better SDG performance leads to a net outflow of funds, especially from individual investors. Such implication may be due to the existence of
-
Industry tournament incentives and acquisition performance Finance Research Letters (IF 7.4) Pub Date : 2024-05-29 Huai Qin, Yongjian Huang
This paper examines the effect of industry tournament incentives on acquisition performance. Using the pay gap between a firm's CEO and the highest-paid CEO in the same industry as the measure of industry tournament incentives, we find that deals led by CEOs with higher industry tournament incentives experience higher abnormal announcement returns. This positive relation between industry tournament
-
Financial instability in Europe: Does geopolitical risk from proximate countries and trading partners matter? Finance Research Letters (IF 7.4) Pub Date : 2024-05-29 Jiahao Liu, Wenyu Shen
Using a spatial econometric approach, we measure 28 European countries' foreign geopolitical risks (GPR) from their proximate countries, export destinations, and import origins from January 1985 to January 2024 at a monthly frequency. Based on difference GMM estimation on dynamic panel data model, we find that the foreign GPRs increase Europe's financial instability through potential channels of surging
-
Executive team restructuring and corporate ESG disclosure quality Finance Research Letters (IF 7.4) Pub Date : 2024-05-29 Chengyu Bai, Dan Liu, Yong Liu
This paper explores the impact mechanism of executive team restructuring on corporate ESG disclosure quality from the perspective of executive team restructuring. It is found that executive team restructuring enhances disclosure quality by introducing diverse executive members. This enhancement will be more evident in non-state-owned enterprises. A typology test of executive team restructuring finds