scholarly journals Firm Characteristics and Long-Run Abnormal Returns after IPOs: A Jordanian Financial Market Experience

2015 ◽  
Vol 7 (3) ◽  
Author(s):  
Fawaz Al-Shawawreh ◽  
Osama Al-Tarawneh
Keyword(s):  
Financial Market ◽  
Abnormal Returns ◽  
Firm Characteristics ◽  
Long Run ◽  
Market Experience

LEARNING DYNAMICS AND NONLINEAR MISSPECIFICATION IN AN ARTIFICIAL FINANCIAL MARKET

2009 ◽  
Vol 13 (5) ◽  
pp. 625-655 ◽  
Author(s):  
Christophre Georges ◽  
John C. Wallace
Keyword(s):  
Time Series ◽  
Financial Market ◽  
Consistency Condition ◽  
Nonlinear Structure ◽  
State Variable ◽  
Bounded Memory ◽  
Long Run ◽  
Finite Memory ◽  
Aggregate Dynamics ◽  
True Structure

In this paper, we explore the consequence of learning to forecast in a very simple environment. Agents have bounded memory and incorrectly believe that there is nonlinear structure underlying the aggregate time series dynamics. Under social learning with finite memory, agents may be unable to learn the true structure of the economy and rather may chase spurious trends, destabilizing the actual aggregate dynamics. We explore the degree to which agents' forecasts are drawn toward a minimal state variable learning equilibrium as well as a weaker long-run consistency condition.

Best-value supply chains and firms’ competitive performance: empirical studies of their linkage

2015 ◽  
Vol 35 (12) ◽  
pp. 1688-1709 ◽  
Author(s):  
Xun Li ◽  
Qun Wu ◽  
Clyde W. Holsapple
Keyword(s):  
Supply Chains ◽  
Competitive Advantage ◽  
Empirical Studies ◽  
Abnormal Returns ◽  
Competitive Performance ◽  
Content Type ◽  
Long Run ◽  
Best Value ◽  
Multiple Method ◽  
The Impact

Purpose – Best-value supply chains characterized by agility, adaptability, and alignment, have become a crucial strategic means for firms to create and sustain competitive advantage in today’s turbulent environment. The purpose of this paper is to investigate linkage between best-value supply chains and firms’ competitive performance. Design/methodology/approach – In Study 1, survey data from 76 firms is used to test the impact of the three qualities of best-value supply chains on firms’ competitive performance. In Study 2, to test if a firm’s competitive advantage can be sustained through building best-value supply chains, a long-run performance analysis is conducted, which is based on a stock portfolio of firms identified from the American Marketing Association’s annual list of “Supply Chain Top 25.” Findings – The results of Study 1 indicate that the three qualities of best-value supply chains are positively related to firms’ competitive performance. The results of Study 2 show that firms having best-value supply chains generate significant and positive abnormal returns for shareholders over time. Originality/value – This is a multiple-method research, providing two-level empirical evidence to the investigation of theoretical linkage between best-value supply chains and firms’ competitive performance.

scholarly journals From Shareholder Value to CEO Power: The Paradox of the 1990s

2005 ◽  
Vol 9 (1) ◽  
pp. 7-47 ◽  
Author(s):  
Robert Boyer
Keyword(s):  
Financial Market ◽  
Moral Philosophy ◽  
Bargaining Power ◽  
Stock Options ◽  
Ceo Power ◽  
Economic Theories ◽  
Long Run ◽  
Legal Sanctions ◽  
Top Manager ◽  
Wage Earners

Why did CEO remuneration explode during the 1990s and persist at high levels, even after the Internet bubble burst? This article surveys the alternative explanations that have been given of this paradox, mainly by various economic theories with some extension to political science, business administration, social psychology, moral philosophy and network analysis. It is argued that the diffusion of stock options and financial market-related incentives, supposed to discipline managers, have entitled them to convert their intrinsic power into remuneration and wealth, both at micro and macro level. This is the outcome of a de facto alliance of executives with financiers, who have exploited the long-run erosion of wage earners' bargaining power. The article also discusses the possible reforms that could reduce the probability and the adverse consequences of CEO and top-manager opportunism: reputation, business ethic, legal sanctions, public auditing of companies, or a shift from a shareholder to a stakeholder conception.

The Incidence, Valuation and Management of Tax-related Reputational Costs: Evidence from a Period of Protest

2021 ◽  
Author(s):  
Dan S. Dhaliwal ◽  
Theodore H Goodman ◽  
P.J. Hoffman ◽  
Casey M Schwab
Keyword(s):  
Media Coverage ◽  
Abnormal Returns ◽  
Tax Avoidance ◽  
Social Protest ◽  
Tax Rates ◽  
Firm Characteristics ◽  
Political Costs ◽  
Time Invariant ◽  
Media Sentiment ◽  
Reputational Costs

We examine the incidence, valuation and management of tax-related reputational costs during 2011, a year of extensive social protest that temporarily increased scrutiny of corporate tax avoidance. We report three main results. First, tax avoidance is positively associated with negative media sentiment during the protest period (i.e., 2011). Second, a hedge portfolio long (short) in low (high) tax avoidance firms generates positive abnormal returns during the protest period. Third, firms experiencing the largest reputational costs during the protest period report higher tax rates in subsequent years. Supplemental analyses indicate tax-related media coverage increased during the protest period, and that the results are unlikely driven by political costs or other time-invariant firm characteristics. Our findings suggest that tax-related reputational costs are not pervasive. Instead, these costs only occur during periods of unusually high scrutiny, which helps explain prior studies' difficulties in providing large-sample evidence of tax-related reputational costs.

Long-Run IPO Performance Analysis of German and Spanish Family-Owned Businesses

2005 ◽  
Vol 18 (3) ◽  
pp. 179-202 ◽  
Author(s):  
Peter Jaskiewicz ◽  
Víctor M. González ◽  
Susana Menéndez ◽  
Dirk Schiereck
Keyword(s):  
Stock Market ◽  
Initial Public Offerings ◽  
Family Involvement ◽  
Positive Impact ◽  
Market Performance ◽  
Abnormal Returns ◽  
Negative Influence ◽  
Ipo Performance ◽  
Long Run ◽  
Stock Market Performance

This article examines the long-run stock market performance of German and Spanish initial public offerings (IPOs) between 1990 and 2000. We distinguish between family-and nonfamily-owned business IPOs by using the power subscale of the F-PEC. Buy-and-hold-abnormal returns (BHAR) are calculated in order to determine abnormal returns. Our results show that three years after going public, investors, on average, realized an abnormal return of − 32.8% for German and − 36.7% for Spanish IPOs. In both countries, nonfamily business IPOs perform insignificantly better. Regression analyses show that for the whole sample there is a positive company size effect. In family-owned businesses, strong family involvement has a positive impact on the long-run stock market performance, whereas the age of the firm has a negative influence.

Financial Deepening

2019 ◽  
Vol 18 (2) ◽  
pp. 111-137
Author(s):  
Shankha Chakraborty
Keyword(s):  
Financial Development ◽  
Financial Market ◽  
Capital Accumulation ◽  
Agency Problems ◽  
Financial Structure ◽  
Financial Deepening ◽  
External Finance ◽  
Long Run ◽  
Financial Contract ◽  
Further Development

This article proposes a tractable model of the evolution of financial structure. Firms invest out of internal assets and by borrowing from banks and the financial market. In the presence of moral hazard, whereby owner–managers may intentionally reduce profitability of investment to appropriate resources, banks can monitor firms and partially alleviate agency problems. Under the optimal financial contract, banks monitor and outside investors lend to firms only if they borrow from banks too. The model is broadly consistent with financial development facts. Capital accumulation is facilitated by an increasing reliance on both types of external finance. Initially firms rely more heavily on expensive bank finance. With further development, banks eliminate much of the agency problem and firms substitute in favour of cheaper market finance. The short- and long-run effects of financial sector reforms are considered. JEL: E44, G20, O16

scholarly journals Impact of Open-Market Share Repurchases on Long-Term Stock Returns

SAGE Open ◽  
2016 ◽  
Vol 6 (4) ◽  
pp. 215824401667019 ◽  
Author(s):  
Mohamed Albaity ◽  
Diana Syafiza Said
Keyword(s):  
Stock Returns ◽  
Abnormal Returns ◽  
Sampling Period ◽  
Share Repurchases ◽  
Open Market ◽  
Calendar Time ◽  
Price Performance ◽  
Long Run ◽  
Portfolio Approach

After the Asian financial crisis in 1997, firms listed on Bursa Malaysia were allowed to repurchase their shares on the open market. The number of companies engaged in share buyback is increasing and has become a tool to stabilize price by signaling undervaluation of the share. However, studies on share buyback in Malaysia are limited to the price performance surrounding the buyback events. This study aims to fill this gap by examining long-run price performance after the actual share buyback event over a sampling period of 2 years from 2009 to 2010 for Malaysian firms listed on FTSE Bursa Malaysia. There is no evidence to conclude that there exist long-term abnormal returns using the calendar-time portfolio approach that support the inefficient market hypothesis. On the contrary, buy-and-hold method was found to be significant supporting that the Malaysian stock market is semi-strong efficient.

Financial Depth and Exchange Rate Volatility

2016 ◽  
Vol 62 (1) ◽  
pp. 19-30 ◽  
Author(s):  
Massomeh Hajilee ◽  
Omar M. Al Nasser
Keyword(s):  
Exchange Rate ◽  
Financial Market ◽  
Exchange Rate Volatility ◽  
Financial Deepening ◽  
Bounds Testing ◽  
Exchange Rate Uncertainty ◽  
Long Run ◽  
Financial Depth ◽  
Short Run ◽  
The Many

It is empirically well established that financial depth increases the power of the financial system and helps both government and the private sector to have access to adequate funds without a noticeable change in asset prices and exchange rates. Exchange rate uncertainty is considered one of the many factors that affect financial market performance. In this study, we try to determine the short-run and long-run effects of exchange rate volatility on financial depth in 26 selected countries, classified as developed, developing, and emerging economies over the period 1980-2011. Our findings indicate that exchange rate volatility has short-run and long-run effects in the majority of countries in this study. We found for 16 countries out of 26, financial depth responds significantly to exchange rate volatility (nine positive, seven negative). Furthermore, using the bounds testing approach shows that exchange rate volatility has significant impact on financial deepening in 20 out of 26 countries in the short run. The results show that despite similar classification and grouping, the estimated results could be very country specific depending on each country’s particular characteristics. We suggest that for every country, it is crucial to choose and implement appropriate financial market and exchange rate policies.

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