Candidate–Evaluator Similarity, Favouritism, Informational Advantage, and Committee Dynamics

2020 ◽  
Vol 46 (3) ◽  
pp. 414-428
Author(s):  
Vincent Chandler
Keyword(s):  
Informational Advantage

Why Do Firms Disagree with Short Sellers? Managerial Myopia versus Private Information

2019 ◽  
Vol 55 (8) ◽  
pp. 2431-2465 ◽  
Author(s):  
Leonce Bargeron ◽  
Alice Bonaime
Keyword(s):  
Private Information ◽  
Trading Strategy ◽  
Short Sellers ◽  
Managerial Myopia ◽  
Agency Issues ◽  
Target Management ◽  
Short Interest ◽  
Short Termism ◽  
Informational Advantage

Though short sellers on average succeed at identifying overvalued equity, firms often signal disagreement with short sellers by repurchasing stock when short interest increases. We investigate whether this disagreement reflects a myopic defense of inflated prices, or positive private information. These repurchases appear motivated by managers’ private information, not agency issues, even when managerial benefits to short-termism are enhanced or monitoring is weaker. Managers’ informational advantage relates to subsequent news, earnings, and risk, but is attenuated if activists target management or insiders sell. A trading strategy based on our findings earns 7.5% annually.

scholarly journals Advocatus, et non Latro? Testing the Excess of Litigation in the Italian Courts of Justice

2014 ◽  
Vol 10 (3) ◽  
Author(s):  
Paolo Buonanno ◽  
Matteo M. Galizzi
Keyword(s):  
Empirical Analysis ◽  
Instrumental Variables ◽  
Sharp Increase ◽  
Civil Litigation ◽  
Induced Demand ◽  
Time Period ◽  
Causality Relationship ◽  
Informational Advantage

AbstractWe explore the causality relationship between litigation rates and the number of lawyers, drawing on an original panel dataset for the 169 Italian first-instance courts of justice between 2000 and 2007. In this time period, both the number of lawyers and the civil litigation rate sharply increased, and a mandatory minimum fee was in place for lawyers’ services. We first document that the number of lawyers is positively correlated with different measures of the litigation rate. Then, using an instrumental variables strategy, we find that a 10% increase in lawyers over population is associated with an increase between 1.6 and 6% in civil litigation rates. Our empirical analysis supports the supplier-induced demand (SID) hypothesis for Italian lawyers: following a sharp increase in the number of lawyers, and in the impossibility of competing on price because of the minimum fee regulation, some lawyers may have opportunistically used their informational advantage to induce their clients to bring lawsuits into court more often than would have been optimal if they were acting in the exclusive interest of their clients.

Do Analysts Gain an Informational Advantage by Visiting Listed Companies?

2018 ◽  
Vol 35 (4) ◽  
pp. 1843-1867 ◽  
Author(s):  
Bing Han ◽  
Dongmin Kong ◽  
Shasha Liu
Keyword(s):  
Listed Companies ◽  
Informational Advantage

scholarly journals Entry Regulation under Asymmetric Information about Demand

2010 ◽  
Vol 2010 ◽  
pp. 1-10 ◽  
Author(s):  
Paula Sarmento ◽  
António Brandão
Keyword(s):  
Asymmetric Information ◽  
Regulatory Policy ◽  
Entry Regulation ◽  
Incumbent Firm ◽  
Long Run ◽  
Short Run ◽  
Pooling Equilibrium ◽  
Insufficient Entry ◽  
Final Effect ◽  
Informational Advantage

We investigate how an incumbent firm can use the regulatory policy about entry and the informational advantage to protect his market position. This question is studied through the construction of a signalling game where we assume that the regulator has less information about demand than the firms. We conclude that there is a pooling equilibrium and partially separating equilibria in which entry is deterred and, if demand is high, there will be insufficient entry. The final effect on welfare depends on the tradeoff between short-run benefits (lower price) and long-run losses (weaker competition).

scholarly journals Building Effective Clusters and Industrial Parks

2019 ◽  
pp. 290-308
Author(s):  
Xiaobo Zhang
Keyword(s):  
Developing Countries ◽  
Local Governments ◽  
Central Government ◽  
Lessons Learned ◽  
Industrial Districts ◽  
Industrial Park ◽  
International Firms ◽  
Know How ◽  
Industrial Parks ◽  
Informational Advantage

This chapter discusses some of the strategies that are commonly used to build effective clusters and industrial parks. Industrial districts (clusters) offer three major advantages: better access to suppliers and markets, labour market pooling, and spillovers of technological know-how. Compared to the central government, local governments are in a better position to identify and solve the bottlenecks that affect clusters and industrial parks, mainly because of their informational advantage. The chapter first provides an overview of clusters and industrial parks before analysing the experiences of—and the lessons learned by—developing countries such as China in building them. Four strategies to increase the chances of success of a cluster and industrial park are highlighted: targeting international firms, targeting grouped businesses, incentivizing first movers, and adopting a step-by-step approach. The chapter also considers a number of reasons why clusters and industrial parks failed in countries like India, Egypt, and Senegal.

Measuring Informational Advantage of A Group of Investors

2008 ◽  
Vol 16 (2) ◽  
pp. 127-152
Author(s):  
Seung Hyun Oh
Keyword(s):  
Adverse Selection ◽  
Risk Premium ◽  
Stock Return ◽  
Informed Trading ◽  
Individual Investors ◽  
Return Volatility ◽  
Selection Theory ◽  
Market Stabilization ◽  
Current Return ◽  
Informational Advantage

This study interprets various theories of volume of stock markets in a unified DOint of view and classifies the theories into 4 categories: risk premium theory, adverse selection theory, privately informed trading theory, and market stabilization theory. Risk premium theory and adverse selection theory predict that net buying amount of an uninformed trader and future stock return have negative correlation and that ttle correlation approaches-I as current return volatility increases. Privately informed trading theory and market stabilization theory predict that net buying amount of an Informed trader and future stock return have posltive correlation and that the correlation approaches 1 as current return volatility increases. Utilizing these two predictions. this study suggests a method of measuring informational advantage of a group of investors. To measure degrees of Informational advantage of some investor groups in Korean stock market. the method is applied to 7 groups of investors: foreign investors, individual investors. institutional investors, securities companies, Insurers. ITCs, and banks. The result shows that ITCs have the highest degree of informational advant~ age while Individual investors have the lowest level of informational advantage. The fact that this result is consistent with prior researches means that the method suggested in this study has enough empirical validity. This method may be used in a performance evaluation process for a specific fund or a portfolio manager.

scholarly journals Adverse Selection Spirals

2006 ◽  
Vol 36 (2) ◽  
pp. 589-628
Author(s):  
Piet De Jong ◽  
Shauna Ferris
Keyword(s):  
Family History ◽  
Adverse Selection ◽  
Risk Classification ◽  
Insurance Market ◽  
Severe Problem ◽  
Risk Levels ◽  
Correlated Information ◽  
The Uk ◽  
Informational Advantage

This article discusses risk classification and develops and discusses a framework for estimating the effects of restrictions on risk classification. It is shown that expected losses due to adverse selection depend only on means, variances and covariances of insurance factors and rates of uptake of insurance. Percentage loadings required to avoid losses are displayed. Correlated information, such as family history, is also incorporated and it is seen how such information limits losses and decreases required loadings. Although the evidence suggests that adverse selection is not, at present, a severe problem for insurers, this might change if the authorities impose restrictions on risk classification and/or customers gain an informational advantage (such as better knowledge of their own risk levels). Application is made to unisex annuity pricing in the UK insurance market.

Sign in / Sign up

Export Citation Format

Share Document