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Does Sovereign ESG Shape Corporate Cash Management in Emerging Markets? Finance Research Letters (IF 7.4) Pub Date : 2024-07-23 Abdullah A Aljughaiman, Thamir Al Barrak, Kaouther Chebbi
Environmental, social, and governance aspects are becoming increasingly crucial factors for investors decisions. This paper examines the effect of sovereign environmental, social, and governance (SESG) practices on the cash-holding decisions of firms in the Gulf Cooperation Council (GCC) region. Utilizing firm-level data from 2010 to 2022, we find that improved SESG standards lead firms to reduce their
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Excess goodwill and enterprise litigation risk Finance Research Letters (IF 7.4) Pub Date : 2024-07-23 Muyun Wang, Ying Zhang
Corporate mergers and acquisitions (M&A) are now a common strategic choice for enterprises. As such, goodwill, which is a core asset of M&A activities, is pivotal for financial valuation and accounting. However, the phenomenon of ‘excess goodwill’, resulting from overvaluation due to management overconfidence and performance promises, poses significant risks, including potential financial statement
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Can the development of Fintech mitigate Non-Performing Loan risk? Finance Research Letters (IF 7.4) Pub Date : 2024-07-22 Yuanzhe Chai, Suchao Sun
This paper examines how commercial banks’ fintech development can mitigate non-performing loan (NPL) risk. This study adopted a two-fixed model and examined listed commercial banks from 2011 to 2022. Findings indicate that fintech development can mitigate NPL risk through pre-lending and post-loan cost reduction and revenue growth effects. This study contributes to theory and practice for advancing
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Is it a matter of governance or judicial favoritism? Legal expertise at an executive level and its use in cases of corporate financial fraud Finance Research Letters (IF 7.4) Pub Date : 2024-07-22 Yingzhi Nie, Yanhua Na, Peng Chen
This study examines how executives’ legal expertise affects corporate financial fraud and the mechanism behind this using data from A-listed companies between 2011 and 2021. Findings show a positive correlation between executives’ legal backgrounds and corporate financial fraud, which is mainly driven by external audit quality and corporate social responsibility. This finding provides evidence of how
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Digital transformation and the herd behavior of corporate investment Finance Research Letters (IF 7.4) Pub Date : 2024-07-22 Xiaoyun Li, Qianning Wang, Tong Wu, Qing Bian
Digital technology is a widespread integration of the benefits of digital transformation into all aspects of modern company operations. This paper examines how digital transformation affects firms’ investment herd behaviour. Based on listed firms from 2012 to 2022, this paper adopts a two-fixed model to explore the effects and underlying mechanisms. The findings indicate that digital transformation
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The Lower the Integrity, the Higher the Risk: How Does the Lack of Corporate Integrity Exacerbate Risk? Finance Research Letters (IF 7.4) Pub Date : 2024-07-22 Ying Chen, Fei Gao
Corporate integrity is not only a core element of its success but also plays a crucial role in the development of the corporation itself, consumers, investors, and society as a whole. This paper focuses on companies listed on the A-share market from 2017 to 2022, delving into the impact of corporate integrity on business risk. The findings indicate a significant negative correlation between corporate
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Guest Editorial: Sustainable and Socially Responsible Finance – University of Bologna, Forli Campus - 2022 Finance Research Letters (IF 7.4) Pub Date : 2024-07-22 Giovanni Cardillo, Andi Duqi, Salvatore Perdichizzi, Giuseppe Torluccio
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Energy market uncertainties and exchange rate volatility: A GARCH-MIDAS approach Finance Research Letters (IF 7.4) Pub Date : 2024-07-22 Afees A. Salisu, Ahamuefula E. Ogbonna, Rangan Gupta, Qiang Ji
In this paper, we employ the generalized autoregressive conditional heteroscedasticity-mixed data sampling (GARCH-MIDAS) framework to forecast the daily volatility of 19 dollar-based exchange rate returns based on monthly metrics of oil price uncertainty (OPU), and relatively broader global and country-specific energy market-related uncertainty indexes (EUI). We find that the global EUIs tend to perform
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The ESG-efficient frontier under ESG rating uncertainty Finance Research Letters (IF 7.4) Pub Date : 2024-07-20 Messaoud Chibane, Mathieu Joubrel
The impact of ESG score uncertainty on the risk-return profile of socially responsible optimal portfolios is analyzed. Focusing on the 109 largest French company stock prices between 2021 and 2024, uncertainty about ESG score is measured through the lens of investors’ assessment rather than from ESG rating agencies. The efficient frontier is generalized by introducing the degree of investors’ social
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CEO-employee pay ratio and labor investment efficiency Finance Research Letters (IF 7.4) Pub Date : 2024-07-20 Yulin Li, Chee Seng Cheong, Jean Canil
This paper investigates the impact of CEO-to-median employee pay ratios on labor investment efficiency. Drawing on competing predictions from Talent Assignment Theory and Equity Theory, we examine how pay disparity between CEOs and average workers influences suboptimal investment in labor (). Our analysis finds a significant negative relationship between pay ratios and inefficient investment in labor
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The impact of the 2008 Global Financial Crisis on the efficiency and profitability of the U.S. small banks Finance Research Letters (IF 7.4) Pub Date : 2024-07-19 Rasoul Rezvanian, Seyed Mehdian
This paper uses data from 732 U.S. small banks operating between 2001 and 2021 to examine the cost efficiency, profitability, and the association between cost efficiency and profitability pre-during and post-2008 Global Financial Crisis (2008 GFC). In step 1, using Data Envelopment Analysis (DEA), the cost efficiency of small U.S. banks is estimated. The results indicate that the overall efficiency
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Predicting oil prices: A comparative analysis of machine learning and image recognition algorithms for trend prediction Finance Research Letters (IF 7.4) Pub Date : 2024-07-18 Ahmet Göncü, Tolga U. Kuzubaş, Burak Saltoğlu
This paper investigates the effectiveness of machine learning algorithms, including logistic regression, artificial neural networks, support vector machines, gradient boosting algorithms (XGBoost, ExtraTrees), random forests, and convolutional neural network (CNN) for trend prediction of daily spot oil prices across horizons of 1 to 8 days. We utilize a comprehensive set of features, including technical
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Avoiding jumps in the rotation matrix of time-varying factor models Finance Research Letters (IF 7.4) Pub Date : 2024-07-17 Ying Lun Cheung
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Do investors in dirty and clean cryptocurrencies care about energy efficiency in the same way? Finance Research Letters (IF 7.4) Pub Date : 2024-07-16 Barbara Będowska-Sójka, Agata Kliber
This paper examines the environmental awareness of cryptocurrency investors. We study cryptocurrencies of different consensus protocols, categorised as clean and dirty. Within the non-linear autoregressive distributed lag model (NARDL), we verify whether short- or long-run dependency exists between cryptos’ prices or volatility and the Index of Cryptocurrency Environmental Attention, ICEA. We find
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Contagious corporate reputation risk: Uncovering the pandemic's impact Finance Research Letters (IF 7.4) Pub Date : 2024-07-15 Zhen Xi, Yawen Xia, Rubi Yang, Ran Hu, Jing Zhao
Firms' Reputation Risk Index () co-move with their industry and local peers in the US market, suggesting that managers follow their industry and local peers to conduct ESG-related irresponsible activities. Moreover, the co-movement with local peers is attenuated during the COVID-19 pandemic period, and the reduction is more significant in democratic states with stringent social distancing policies
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Do heuristics matter for financial literacy? The impact of better heuristics awareness to financial literacy Finance Research Letters (IF 7.4) Pub Date : 2024-07-15 Francisco Pitthan, Kristof De Witte
Policymakers are increasingly focused on improving citizens’ financial well-being through better financial literacy. Traditional strategies emphasize financial education to boost financial knowledge, while recently behavioural-based education focus on issues like behavioural biases and emotional influences. This paper suggests a randomized controlled-study to assess if financial education including
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The equity market response to climate change litigation Finance Research Letters (IF 7.4) Pub Date : 2024-07-15 Zhenshu Wu, Rui Zhong
We document a significant decline in defendants' stock prices after the filing of litigation cases on climate change issues in the US. Economically, we document a 0.5% decline on the filing day and a 2.7% cumulative abnormal decline in the eight days following the filing. Cross-sectional analysis shows that the negative response is more pronounced in firms with greater external financial constraints
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Time-frequency tail risk spillover between ESG climate and high-carbon assets: The role of economic policy uncertainty and financial Stress Finance Research Letters (IF 7.4) Pub Date : 2024-07-15 Zishan Huang, Huiming Zhu, Xi Deng, Tian Zeng
This study proposes the multiscale R decomposed connectedness approach to investigate the time-frequency contemporaneous and lagged risk spillover between ESG climate and high-carbon assets. We further track the time-varying predictive power of economic policy uncertainty (EPU) and financial stress (FSI) for risk contagion. In the risk connectedness between ESG and high-carbon assets, contemporaneous
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Digital transformation and high-quality development of sports-listed companies: An analysis of vocabulary from annual report texts Finance Research Letters (IF 7.4) Pub Date : 2024-07-15 Li Chao, Qin Hongdi, Chen Yijie
This paper selects sports-listed companies from 2013 to 2022 as the sample and employs text analysis methods to test the impact of digital transformation on the high-quality development of the sports industry. The study finds that digital transformation significantly improves high-quality development by improving the firm's market position and innovation level. These findings contribute to the promotion
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Opacity and frequency dependence of beta Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Sana Ejaz, Vladimir Volkov
This paper examines the relationship between opacity and frequency dependence of systematic risk (), estimated over different horizons using Wavelet Transform, for small and large firms. The findings provide evidence for the frequency-specific nature of opacity and suggest that while opacity is positively related to the frequency dependence of beta for large firms at all frequencies, for small firms
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Risk exposure in ESG-driven portfolios: A wavelet study within the tail-concerned insurance sector Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Francisco Jareño, Carlos Esparcia, Giulia Fantini
This paper employs wavelet analysis methodology to examine the pairwise time-frequency connectedness and lead-lag relationships between ESG rating changes and insurance equity portfolios' risk exposure. Focusing on the influence of ESG rating changes rather than absolute levels, it contributes to existing research, shedding light on the nuanced dynamics within the insurance sector. The findings underscore
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How does a small firm end up with a more expensive loan guarantee when a cheaper and safer one was on offer? The intriguing case of two UK Covid-19 guarantee schemes Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Marc Cowling, Nick Wilson, Weixi Liu
Most countries introduced loan guarantee schemes in the Covid-19 pandemic, and the UK offered two schemes. The BBL scheme had a cap of £50,000, a 100 % guarantee, and a fixed interest rate of 2.5 %. The CBILS scheme had a cap of £5 m, an 80 % guarantee and lenders set interest rates. We exploit a behavioural anomaly that led to 9,989 firms taking a CBILS loan for a cash amount below the BBL loan cap
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Volatility or higher moments: Which is more important in return density forecasts of stochastic volatility model? Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Chenxing Li, Zehua Zhang, Ran Zhao
Extensions of the stochastic volatility (SV) model focus on improving volatility inference or modeling higher moments of the return distribution. This study investigates which extension can better improve return density forecasts. By examining various specifications with S&P 500 daily returns for nearly 20 years, we find that a more accurate capture of volatility dynamics with realized volatility and
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Digital finance, life cycle, and enterprise mergers and acquisitions Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Zhen Peng, Fan Bai, Feng Zhao
This study examine the relationship between digital finance and enterprise mergers and acquisitions. The study finds that: (1) Digital finance can significantly increase the probability of enterprise mergers and acquisitions; (2) The impact of digital finance on mergers and acquisitions varies across different enterprise life cycle stages, specifically in the growth and maturity stages, where the positive
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Low-carbon city pilot, external governance, and green innovation Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Lei Shi, Yanping Wang, Lei Jing
This study examines the impact of low-carbon city pilot policies on green innovation of enterprises. We find that: (1) The low-carbon city pilot policy significantly promotes green innovation in enterprises, while improving the quantity and quality of green innovation in enterprises. (2) R&D investment plays a mediating role in the relationship between the low-carbon city pilot policy and green innovation
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Does digitalization improve supply chain efficiency? Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Zhipeng Yu, Xiaonan Cao, Lu Tang, Taihua Yan, Zeyu Wang
Enhancing supply chain efficiency (SCE) is crucial for establishing a modern supply chain system. This study determines that (I) supply chain digitalization (SCD) has a significant positive impact on enhancing SCE; (II) SCD reduces information asymmetry between enterprises, driving all entities within the chain toward digital transformation, which improves overall SCE; and (III) state-owned enterprises
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Influence of enterprise innovation on auditor behavior Finance Research Letters (IF 7.4) Pub Date : 2024-07-14 Chunyu Xing, Xiaorui Li, Hang Meng
Enterprise innovation is accompanied by many uncertainties. This article studies the influence of enterprise innovation on auditor behaviors (e.g., fees, opinions, and quality). The results show that auditors tend to charge higher fees with increased enterprise innovation, but they are not inclined to issue non-standard opinions. Indeed, auditors will improve quality to cope with innovation, leading
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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
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Market-based debt-to-equity conversion and corporate green innovation Finance Research Letters (IF 7.4) Pub Date : 2024-07-11 Xin Gu
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Party organizations’ participation in board governance and corporate supply chain stability Finance Research Letters (IF 7.4) Pub Date : 2024-07-11 Tianbo Wang, Tong Zou, Liang Zhao
This study undertakes an empirical investigation into the impact of party organization engagement in board governance on the stability of corporate supply chains. The findings reveal the existence of an inverted U-shaped correlation between party organization involvement in governance and supply chain stability. Similarly, an inverted U-shaped relationship is observed between the party organization's
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Corporate financialization and litigation risk Finance Research Letters (IF 7.4) Pub Date : 2024-07-11 Yang Li, Xiaorong Lin, Xingfan Lei, Ji Ge, Jingyi Guo, Wenxin Xia
This study empirically analyses the impact of corporate financialization on litigation risk and finds that there is a U-shaped relationship between corporate financialization and litigation risk, whereby an increase in the level of financialization reduces litigation risk before a firm's level of financialization reaches the optimal level, and an increase in the level of financialization exacerbates
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The role of biodiversity risk in stock price crashes Finance Research Letters (IF 7.4) Pub Date : 2024-07-11 Chao Liang, Jinyu Yang, Lihua Shen, Dayong Dong
This study examines whether and how firms’ biodiversity risk exposure affects future stock price crash risk. By analyzing data from US listed companies, we find a significant and positive association between biodiversity risk exposure and future crash risk. The additional analysis indicates that the biodiversity-related transition risks caused by regulations still significantly increase future crash
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How regulatory media information disclosure affects auditor selection–Empirical evidence based on the interaction platform between investors and listed companies Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Honglan Jiang, Qing Jiang
This study uses a econometric model to assess how online interactions between investors and listed companies influence auditor selection. It observes auditor choice as a metric to gauge management's response to market reactions from information disclosed on investor-company platforms. Findings reveal that more effective online interactions lead to the selection of higher quality auditors, especially
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The role of promotion versus prevention-orientation to predict individual cryptocurrency participation Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Ylva Baeckström, Akanksha Jalan, Roman Matkovskyy
We investigate cryptocurrency participation within the context of Regulatory Focus Theory (RFT) among 1,519 individuals in Denmark, Finland and Sweden. Analysis of survey responses identifies the tendency for promotion-focused investors to gravitate towards the high-risk, high-reward potential of cryptocurrencies, while prevention-focused investors adopt a more cautious approach that prioritizes safer
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Digitalization as a driver of European SMEs’ financial performance during COVID-19 Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Georgios A. Savvakis, Dimitris Kenourgios, Panagiotis Trakadas
This paper analyzes the impact of the European economy's digitalization on the financial performance of European small and medium enterprises (SMEs) during COVID-19. Using a panel data from 2017 to 2022 of 12,179 European SMEs and a European transformed digitalization index, we find that the financial performance of SMEs is significantly and negatively associated with the COVID-19 pandemic. Digitalization
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A closed-form solution for spot volatility from options under limited data Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Aoran Zhang, Chunyang Zhou
In this article, the closed-form solution for spot volatility from European options is investigated. The price of the underlying asset follows a diffusion process with stochastic volatility. This approach requires only four European option contracts, making it applicable within limited data constraints. Numerical simulations are presented to prove the effectiveness and robustness.
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Financial development, money demand, and currency internationalization: based on a multidimensional globalization perspective Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Xiaoyong Wang, Dapeng Liu, Panpan Zhang
Current research on measuring currency internationalization has important implications for effectively examining the scope of currency internationalization among emerging economies. We examined the effects of countries’ financial development on their currency internationalization from a multidimensional globalization perspective. Using imbalanced panel data from 167 countries spanning from 1970 to
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Supply chain digitalization and corporate ESG performance: Evidence from supply chain innovation and application pilot policy Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Yan Zhu, Zhuyun Zhang
The increasing environmental unpredictability has amplified the strategic significance of contemporary digital supply networks. Gaining a comprehensive understanding of the mechanisms and effects of supply chains enabled by digital technology is essential for implementing reforms that improve the economy's supply side. This study utilizes the Difference-in-Differences (DID) approach to investigate
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Effects of urban financial agglomeration on managerial mobility and corporate management compensation Finance Research Letters (IF 7.4) Pub Date : 2024-07-10 Siyuan Wang
Considering the geographical and economic characteristics of corporations, this article examines the impact of financial agglomeration on managerial compensation level and structure in A-share listed corporations from 2008 – 2022. Results demonstrate a direct relationship between urban financial agglomeration and managerial remuneration. Furthermore, the remuneration structure of these managers includes
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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.
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Oil market regulatory: An ensembled model for prediction Finance Research Letters (IF 7.4) Pub Date : 2024-07-09 Haixin Chen, Yancheng Liu, Xiangjie Li, Xiang Gu, Kun Fan
This study develops an ensemble framework combining phase space reconstruction and support vector machines to predict oil prices, crucial for economic regulation in energy markets. We analyzed five representative crude oils from spot and futures markets. Our method provides reliable 18-day predictions, demonstrating robustness against non-stationary, noisy data. Compared to traditional models, it shows
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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
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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
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Executive educational background, corporate governance and corporate default risk Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Yu Zheng, Mingnan Zheng, Juan Zhang
This paper investigates the association between executive educational background and corporate default risk, and analyzes the mechanism of corporate governance as a regulating factor. The research in this paper shows that: (1) executive educational background negatively affects corporate default risk. (2) Corporate governance plays a moderating role in the influence of executive educational background
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Credit default risk, internal control and stock returns Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Ting Tian
This paper selects the data of China's A-share listed companies from 2012 to 2022 as a research sample to explore the relationship between the credit default risk of listed companies and stock return. It is found that the credit default risk of listed companies hurts stock return; enterprises with high quality of internal control motivate enterprises to carry out effective risk management and reduce
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Financial opening deepening, managerial ability, and corporate cost stickiness Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 JunNan Qin, Mulin Li, Jiarun You, Zerui Zhang
This paper empirically examines the impact of managerial ability on corporate cost stickiness among all non-financial listed companies in China's Shanghai and Shenzhen A-shares, following the implementation of the ``Shanghai-Hong Kong Stock Connect,'' a policy for deepening financial opening. The empirical results suggest that managerial ability can significantly mitigate corporate cost stickiness
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Minimum wage level and corporate ESG performance Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Min Zhang, Dan Wu, Gongcheng Huang
This paper explores the cost-effectiveness of minimum wage level and their relationship with corporate ESG performance from a theoretical perspective and empirically examines their impact on corporate ESG performance. The study finds that minimum wage level significantly promotes corporate ESG performance, even after considering endogeneity issues. Moreover, the impact of minimum wage level on corporate
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Climate policy initiatives, green finance, and carbon risk interconnectedness Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Ameet Kumar Banerjee, Sabri Boubaker, Nassar S. Al-Nassar
This paper assesses the role of climate policy initiatives and carbon risk in shaping green finance. It also explores the evolving dynamics of interconnectedness with green finance against the backdrop of the energy crisis, weather anomalies, and the escalating risk of environmental degradation. The study uses daily data from January 01, 2016, to March 31, 2023. It implements a quantile VAR-based connectivity
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Ambiguous investor sentiment Finance Research Letters (IF 7.4) Pub Date : 2024-07-08 Moritz Wagner, Xiaopeng Wei
This study examines the interaction between investor sentiment, ambiguity, and asset pricing. While the existing literature highlights the importance of sentiment in times of higher uncertainty, our study further shows the nuanced distinction between ambiguity and standard uncertainty. We examine their effects on the relationship between sentiment and future stock market returns at the daily and monthly
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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