Labor Adjustment Costs and Risk Management

2018 ◽  
Vol 54 (3) ◽  
pp. 1447-1468 ◽  
Author(s):  
Yue Qiu
Keyword(s):  
Risk Management ◽  
Foreign Currency ◽  
State Level ◽  
Adjustment Costs ◽  
Investment Opportunity ◽  
Corporate Risk Management ◽  
Labor Adjustment Costs ◽  
Labor Adjustment ◽  
Internal Funds ◽  
Corporate Risk

This paper studies the effects of labor adjustment costs on corporate risk management. Labor adjustment costs attenuate the correlation between the internal funds of a firm and its investment opportunity, and create more incentives for the firm to smooth internal funds. Using a state border discontinuity approach, I find that state-level labor protection laws significantly impact a firm’s use of foreign currency derivative contracts. I further find that a firm holds more cash when labor adjustment costs are larger, and such an effect concentrates on firms that do not engage in derivative hedging.

Asymmetric Information and Corporate Risk Management by Using Foreign Currency Derivatives

2012 ◽  
Vol 15 (01) ◽  
pp. 1250004 ◽  
Author(s):  
Bingxuan Lin ◽  
Chen-Miao Lin
Keyword(s):  
Risk Management ◽  
Asymmetric Information ◽  
Information Asymmetry ◽  
Foreign Currency ◽  
Corporate Risk Management ◽  
Currency Derivatives ◽  
Medium Level ◽  
Low Levels ◽  
Corporate Risk ◽  
Very High

We examine how information asymmetry affects a firm's incentive to hedge versus speculate by using foreign currency derivatives. We find a quadratic relation between asymmetric information and a firm's risk management activities. In particular, we find that the firms facing medium level of information asymmetry are more likely to hedge, while firms with very high and low levels of asymmetric information tend to speculate. Moreover, we find that our results hold primary for firms operating in highly competitive industries.

Corporate risk management and speculative motives

2007 ◽  
Vol 10 (2) ◽  
pp. 47-72
Author(s):  
Gregory Brown ◽  
Zeigham Khokher
Keyword(s):  
Risk Management ◽  
Corporate Risk Management ◽  
Corporate Risk

Interest Rate Cycles and Corporate Risk Management

2009 ◽  
Author(s):  
Peter Christoffersen ◽  
Amrita Nain ◽  
Jaideep S. Oberoi
Keyword(s):  
Risk Management ◽  
Interest Rate ◽  
Corporate Risk Management ◽  
Corporate Risk

Mandatory governance reform and corporate risk management

2021 ◽  
Vol 68 ◽  
pp. 101935
Author(s):  
Ulrich Hege ◽  
Elaine Hutson ◽  
Elaine Laing
Keyword(s):  
Risk Management ◽  
Governance Reform ◽  
Corporate Risk Management ◽  
Corporate Risk

Choices and Best Practice in Corporate Risk Management Disclosure

2007 ◽  
Vol 19 (4) ◽  
pp. 82-93 ◽  
Author(s):  
Ekaterina E. Emm ◽  
Gerald D. Gay ◽  
Chen-Miao Lin
Keyword(s):  
Risk Management ◽  
Best Practice ◽  
Corporate Risk Management ◽  
Corporate Risk

Insurance: playing Russian roulette?

2021 ◽  
Vol 23 (3) ◽  
pp. 1-4
Author(s):  
Adam Bernstein
Keyword(s):  
Risk Management ◽  
Corporate Risk Management ◽  
Corporate Risk

Insurance is a product that no one wants to buy. However, it is essential, as it is not only legally mandated, but is also a matter of corporate risk management. The question is how homes get the best deal without cutting cover. Adam Bernstein advises on how homes can get the best deal without cutting cover.

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