This study investigates whether the corporate culture of a firm affects its tax shelter behavior. We use a novel machine learning methodology to measure the corporate culture of a firm. Our results show that firms with stronger corporate culture are more likely to have material operations in tax haven countries and the extent of such operations is greater in these firms. The findings also suggest that

Provisions involve a high degree of judgment by corporate managers and substantially affect companies’ reported performance, arguably making them prone to earnings management. To analyze the strategic use of provisions under International Accounting Standard (IAS) 37, we examine the notes disclosures of large European companies that provide detailed information about yearly additions and utilized and

In this paper, we reveal an overlooked but important role of corporate governance on investment efficiency: non-CEO executives. Internal governance, measured as the fraction of independent executives appointed before the current CEO, leads to a better investment efficiency. The governance effect is pronounced when executives have stronger incentives, such as a longer horizon or a higher shareholding

This study introduces the ESG-washing Severity Index (ESGSI) for quantitatively assessing discrepancies between portrayed and actual sustainability practices in corporate disclosures. Using advanced Natural Language Processing (NLP) techniques, we analyze sustainability reports from 749 listed companies, integrating sentiment analysis with the frequency of sustainability terms to calculate the ESGSI

This paper explores the relationship between carbon emissions reduction and corporate financial performance, leveraging a rich dataset of 14,866 observations from 2768 companies across 36 countries and regions, and 35 industries over the period 2002–2022. We find that carbon emissions reductions improve company financial performance, as measured by return on assets and return on equity, with this effect

In this study, we argue that successful exit outcomes (Trade Sales (TS) or IPO) from VCs' cross-border investments are influenced by time-since-first-funding-received (TSFFR) by the venture. As TSFFR increases, the venture reveals more information about its potential, influencing the value that trade and IPO buyers place on it. This, in turn, influences whether VCs exit via a TS or an IPO. Analyzing

The financial inclusion paradigm is increasingly considered a veritable development model. Therefore, we argue that a deeper understanding of it is necessary for enabling policies and strategies that would yield positive development outcomes (successful financial inclusion). We explore this argument by first, defining “effective financial inclusion” along the lines of identifiable population groups

Using an aggregate measure of corporate culture, we find that firms with stronger corporate culture encounter lower investment inefficiency. We show that reducing information asymmetry or engaging in tax avoidance are two potential channels through which corporate culture reduces investment inefficiency. Further analyses reveal that the aforementioned relationship is more pronounced for firms with

The volatility of cross-border capital flow (CF) has become higher in the last two decades. We use a sample of advanced and emerging market economies in the last two decades, with a focus on portfolio fund flows (equities and bonds). We find that the impact of portfolio CF volatility on exchange rate (FX) volatility is diminished in the short-term if specific economic fundamentals of the country are

This paper studies the influence of Reddit social media attention on investor risk-taking and welfare using individual trading data from a large trading platform. We show that attention generated on the subreddit r/wallstreetbets (WSB) spurs uninformed trading, also in short positions. WSB attention increases overall risk levels as investors trade riskier stocks and allocate larger portfolio shares

Based on a sample of pre-sale crowdfunding projects launched on the Kickstarter platform between 2009 and 2021, we find that using promotional words in project descriptions positively affects crowdfunding performance and the effect becomes stronger over time. We also find that, when lying cost is high, when the proportion of naïve investors is high, or when there exists a contemporaneous signal, the

This paper investigates optimal reinsurance under the consideration of contagious catastrophe claims and secondary claims, and the intensity of the latter is modeled as a shot noise process impacted by the former. Also, an α-maxmin mean–variance (MV) criterion is adopted to allow the insurer to have different levels of ambiguity aversion attitudes, and the general mean–variance premium principle is

This study examines the relationships between the individual components of environmental, social, and governance (ESG) performance and future stock returns of US Real Estate Investment Trusts (REITs). The findings demonstrate a negative association between environmental performance and expected returns, while social performance shows a positive relationship with future returns. Moreover, the study

We assess how climate transition risk, through its effects on asset prices, could impact financial stability. Using copula functions, we characterize the conditional distribution of financial firm returns under different climate-related market scenarios. We account for average and tail effects of climate transition scenarios on the value of financial firms using three systemic risk metrics: climate

Successfully achieving an integration strategy with a target depends on various factors. This paper examines how investor sentiment might influence the Merger and Acquisition (M&A) completion process. Using an international sample, the results indicate that a high level of investor sentiment significantly decreases the likelihood of a deal withdrawal and may lead bidders to make non-rational M&A decisions

We examine the comprehensive causal impact of interbank deposits on bank systemic risk by using an international sample of Group of Twenty (G20) listed banks. Using the global wage direct deposit policy as an exogenous shock to interbank deposits, we find that higher interbank deposits result in greater bank systemic risk. A series of instrumental variable approaches, entropy-balanced method, and persistence

This paper investigates whether financial inclusion affects life satisfaction. We perform regressions at the individual level on a large dataset of 59,209 individuals from 29 countries. We find evidence that financial inclusion improves life satisfaction. We further establish that the beneficial effect of financial inclusion takes place through a better health, education and to a lesser extent through

This study examines the impact of WTO climate-related Trade Policy Reviews (TPR) on corporate efforts towards going green, specifically focusing on green technology adoption. Utilising a longitudinal sample comprising 30 countries from 2009 to 2019, the study provides original evidence that companies in countries with more frequent TPRs tend to adopt more green technologies. Channel analysis reveals

This study aims to investigate the role of investor sentiment in the emerging metaverse market, a novel entrepreneurship model. Empirical analyses are conducted through various causality tests to reveal the predictive power of investor sentiment on the price developments of the metaverse market. The Nonlinear Granger causality test indicates causal effects running from BTC (Bitcoin), GT (Google Trend)

We explore the tail risk spillover in the stock and foreign exchange (forex) markets along the G20 countries based on the tail-event driven network (TENET) method. To effectively capture the risk spillover mechanism from the tail-dependence perspective, we analyze the network connectedness in four aspects (namely system, market, region, and country) and explore it at the major emergencies. We find

This study comprehensively investigates stock market volatility based on over one hundred monthly macroeconomic variables, applying machine learning models. Methodological contribution integrating the random forest (RF) with the least absolute shrinkage and selection operator methods (LASSO). Importantly, the RF-LASSO model can robustly achieve the best forecasting performance under different circumstances

We examine the stock market effects of the announcement and issuance of convertible bonds by European companies, conditional on the extent to which the issuers are covered by equity analysts. While there is no significant market reaction to the issue itself, its first announcement is associated with significant negative abnormal returns. However, we find that abnormal returns are less negative for

This study examines the time-varying excess returns in an international interest rate arbitrage (IIRA) strategy, with a particular emphasis on these excess returns. Unlike traditional carry strategies that typically match funding and investment bonds' maturities or currencies, our novel IIRA strategy is a dynamically adjusted approach involves funding with a 1-year low-yield treasury bond while investing

Using standard predictors in the forecasting literature, we forecast the U.S. stock market returns conditional on geopolitical risk and business cycles over the 1927–2021 period. We find that out-of-sample forecasting performance is significantly better in times of high geopolitical risk versus low geopolitical risk. Consistent with previous research, we find further evidence of improved return predictability

With the ongoing advancement of technology, artificial intelligence is increasingly being integrated into banking and finance, with the transformative potential to reshape the financial performance of economies worldwide. This research investigates the dynamic relationship between banking and finance artificial intelligence technology innovation and banks' financial performance across 20 countries

We analyze the competitive dynamics between a decentralized financial system, called a protocol for loanable funds (PLF), and a centralized financial system. A PLF primarily differs from traditional banks in terms of its purpose and its decentralized ledger. While traditional banks pursue profit maximization, the PLF with a decentralized ledger system liquidates borrowing demand in line with the supply

This study examines how firm-level political risk relates to labor performance, measured as the ratio of the total of net income and labor cost to the number of employees. Using a sample of 9508 firm-year observations consisting of U.S. firms during the years 2002–2021, we find a significant and negative relation between political risk and labor performance. Our empirical tests show that after controlling

This study examines the relationship between air pollution and perk consumption and finds strong evidence that firms headquartered in areas with severe air pollution have higher levels of perk consumption. Two plausible mechanisms are executives' higher physiological needs for clean air and stronger bargaining power. We also find that the positive relationship between air pollution and perk consumption

Using the Time-Frequency Wavelet Analysis, this study investigates the dynamic connectedness between the News Sentiment Index (NSI) and ESG leader indices of developed countries. The empirical findings clearly show nontrivial dynamic comovements between NSI and the ESG indices and the existence of the ESG market volatility in different frequency scales. We also report some discrepancies in cross-linkage

This study investigates the impact of crude oil price innovations on global stock market volatility through a ripple-spreading network model, incorporating four dimensions of crude oil price changes: realized volatility, implied volatility, variance risk premium, and realized skewness volatility. Additionally, we assess the effects of three types of crude oil shocks—oil-specific, aggregate demand,

This paper examines the impact of diverse consumption of energy sources on firm performance, focusing on the moderating role of corporate social responsibility (CSR). The paper uses 45,579 firm-level panel data samples across 56 developing and developed economies from 2002 to 2021. It is observed that the impact of energy diversification in improving firms' performance (measured by the return on assets

This paper examines the impact of corporate alcohol culture on employee treatment, and find that a rich corporate alcohol culture atmosphere is negative significantly associated with employee treatment. Mechanistically, the corporate alcohol culture increases the aggressiveness motivation of management, in turn increasing risk taking and management overconfidence. Furthermore, the corporate alcohol

This study investigates the dynamic nexus that major international currencies (US dollar, Euro, Japanese yen) exhibit with cryptocurrencies and highly innovative digital money (DeFi and NFT assets) during inflationary periods such as the Russia-Ukraine conflict (from 14 December 2021 until 1 March 2024). The Quantile Vector Autoregressive methodology as in Cunado et al. (2023) and daily data are adopted

This study examines whether economic policy uncertainty (EPU) is associated with corporate dividend policy. Using a sample of private firms, we find that EPU is negatively related to dividend payouts. Our main findings are robust to endogeneity concerns, omitted variable problems, simultaneity bias, and alternative measures of EPU. Further, we find that firms are less likely to pay dividends when EPU

Faith-based mutual funds have recently become a growing corner of the mutual fund industry. Morality and ethics are thought to exert an influence on investors' decisions in this segment, though their role in driving such investments is not clear as these funds are also attractive due to their distinct risk-return profile. If non-pecuniary motives are predominant, investors in such funds may be less

We adopt a difference-in-difference approach to investigate the relationship between the board network and the acquirer's cumulative abnormal returns (CAR) by examining the influence of the directors' sudden death or retirement. We find that firms experiencing the departure of well-connected directors tend to obtain higher CAR when acquiring private targets. This suggests that well-connected directors

In this study, we utilize the most recent ESG (Environmental, Social, and Governance) data to calculate the ESG distance between acquiring and target firms, subsequently assessing its impact on merger outcomes. Our analysis suggests that deals with a larger ESG distance are associated with reduced cumulative abnormal returns (CARs) around the deal announcements. We find that, following the Kyoto Protocol

Despite the widespread interest in Bitcoin, a universally accepted model explaining its value remains elusive. This article address a cause to this problem. The best-performing model would not be stable over time due to the fact that Bitcoin can be duplicated.

This study applies the Black–Litterman model to portfolio management in a post-crisis scenario, where standard parametric models often fail due to market irrationality and investor overreactions. The research focuses on the performance of surviving firms, identifying that over-performing stocks tend to outperform in the medium- to long-term, while under-performing stocks exhibit stronger short-term

This paper examines the evolution of environmental, social and governance (ESG) reporting by analysing a ten-year corpus of annual reports from FTSE 350 companies. Using BERTopic, an advanced topic modelling technique, we identify and subsequently cluster the most important ESG topics, providing significant insights into the reporting landscape. Our findings show how regulatory changes, such as the

Energy cryptocurrencies emerge as a new class of digital assets for morally conscientious investors to build long-term portfolios with high risk-adjusted returns. Focusing on this unique asset class, the current study investigates the static and dynamic spillovers between energy cryptocurrencies and US equity sector stocks at various quantiles. We apply the quantile VAR technique on the selected sample

This study examines the internal logic and dynamic evolution of corporate carbon information disclosure decision making. Drawing on the game-theoretical relationship among enterprises, third-party carbon verification agencies, and local governments, we analyze the intrinsic mechanisms by which rewards, punishment, and media supervision influence corporate carbon information disclosure behavior. We

This paper examines the influence of presidential economic approval rating (PEAR) on the volatility of 15 major foreign exchange (FX) markets. The study reveals that the PEAR index serves as an insightful predictor for forecasting certain FX market volatilities, demonstrating predictive accuracy both in- and out-of-sample period. This predictability endures over longer horizons and withstands various

We study how market spillovers propagate within a comprehensive system of energy commodities by employing spillover analysis in the time and frequency domains. Raw materials dominate the system’s connectedness, behaving as net transmitters of spillovers. However, the dynamic analysis shows that downstream commodities may also act as net transmitters but only in a few short phases. Importantly, relevant

This paper explores the interplay between reputation mechanisms, pre-commitment strategies, and financial market regulation. Through a theoretical model, we analyze how repeated interactions between market participants, combined with regulatory oversight, can lead to improved compliance and market efficiency. The study demonstrates that reputation mechanisms serve as powerful self-regulatory tools

The development of green bond markets is important for advancing energy efficiency, supporting renewable energy, encouraging sustainable investments, and safeguarding the environment. However, the inherent complexity and uncertainty of these markets pose significant challenges for both investors and researchers. In this study, we focus on analyzing the S&P Green Bond Index, a leading benchmark for

Real estate plays a pivotal role in carbon emissions. Carbon tax policy is a crucial measure for mitigating enterprises' carbon emissions. However, imposing a carbon tax on productive enterprises in the real estate industry to reduce emissions may increase their production costs, which could easily be passed on to buyers, thus inflating real estate prices and impeding policy effectiveness. To examine

Market turmoil, such as that induced by Covid-19, tends to create huge pressure on financial markets, forcing decision-makers and investors to analyze risks and manage their investment portfolios. Taking the market turmoil induced by Covid-19 as an example, this study addresses the question of whether Bitcoin exhibits a hedging and safe haven property during the period of turmoil. We employ the TVP-VAR

Sudden shifts in climate policy, technological innovation, and market preference can negatively impact a firm's asset value, leading to potential climate transition risk. While numerous studies have examined the economic implications of climate transition risk, few have explored its impact on stock price crash risk. This study addresses this gap by introducing a novel quantitative method for assessing

This study utilizes data from Shanghai and Shenzhen A-share listed companies from 2011 to 2021 to explore the impact of foreign shareholding on the development of a low-carbon economy and the underlying mechanisms. Findings show that foreign shareholding significantly reduces corporate carbon emissions and promotes corporate environmental responsibility and low-carbon transformation. The paper further

This study comprehensively analyzes the panel data of 4195 listed companies in the A-share market during the period from 2011 to 2022, aiming to explore the mechanism of fintech's influence on corporate green innovation. The study adopts a two-way fixed effects model to confirm the positive association between fintech and corporate innovation, and reveals the role of fintech in promoting corporate

In this study, we examine the influence of strategic deviance (STD) on U.S. firms' innovation from 2011 to 2019. Our primary findings indicate that STD has a positive effect on a firm's innovation. Furthermore, chain mediation analysis reveals that managerial ability, industry competition, and cash holding partially mediate the impact of STD on U.S. firms' innovation. The robustness of our results

This study examines the nexus between fiscal science and technology (S&T) expenditure and venture capital growth using panel data from 293 prefecture-level cities from 2005 to 2022. Findings reveal that fiscal investments in S&T promote the development of venture capital. Furthermore, favorable business and financial environments positively moderate the stimulatory effect of fiscal S&T expenditure

This study examined the sample data of A-share listed companies in Shanghai and Shenzhen from 2011 to 2022 to explore the relationship between board independence, litigation risk, and expense stickiness. Findings indicate that board independence and litigation risk independently reduced corporate expense stickiness. The impact of board independence on the expense stickiness of firms varied with the

Enhancing the proportion of labor income is essential for reducing income disparity and attaining widespread prosperity. This study utilizes the difference-in-differences (DID) approach to examine the relationship, using data from A-share listed corporations from 2011 to 2022. The discovery demonstrates that implementing the Fair Competition Review System can significantly enhance the labor income

This paper integrates transfer entropy (TE) within the portfolio optimization framework to account for dependencies among assets. This approach helps mitigate systemic risk and create portfolios that are resilient to asymmetric information flows. Key contributions of this study include (1) demonstrating the impact of TE constraints on portfolio diversification and stability, (2) linking TE thresholds

We examine the spillover effects between social media sentiments and market-implied volatilities among stock, bond, foreign exchange, and commodity markets. We find that information mainly spillovers from volatility to sentiment indices, with the VIX being the most significant net transmitter. Within each asset class, there is a more pronounced spillover from volatility to sentiment compared to the

With the growing reliance on machine-learning (ML) methods in finance, an understanding of their long-term efficacy and underlying mechanism is needed. We document the time-varying importance of different stock characteristics over an 18-year (1998–2016) out-of-sample period to determine whether ML models, when trained on a large set of firm and trading characteristics, can consistently outperform

This study examines the dynamic connections between carbon finance mechanisms such as sustainable bonds and emissions trading systems and their role in advancing climate technology. It also explores direct and indirect contributions of carbon finance mechanisms to the progress of climate technology. It employs a causal mediation analysis and high-dimensional fixed-effects panel regression models to

Energy prices crucially affect financial cycles. We employ the bivariate empirical mode decomposition (BEMD) model to disaggregate the daily interval data of the volatility index (VIX) and rely on the threshold autoregressive interval model (TARI) to incorporate energy prices into the forecasting model. Furthermore, the threshold interval decomposition ensemble (TIDE) is used to forecast the VIX series