scholarly journals Country Risk

2021 ◽  
Author(s):  
Tarek A. Hassan ◽  
Jesse Schreger ◽  
Markus Schwedeler ◽  
Ahmed Tahoun
Keyword(s):  
Interest Rates ◽  
Direct Evidence ◽  
Country Risk ◽  
Global Risk ◽  
Firm Level ◽  
Listed Firms ◽  
Quarterly Earnings ◽  
Global Investors ◽  
Definition Of ◽  
Market Valuations

We construct new measures of country risk and sentiment as perceived by global investors and executives using textual analysis of the quarterly earnings calls of publicly listed firms around the world. Our quarterly measures cover 45 countries from 2002-2020. We use our measures to provide a novel characterization of country risk and to provide a harmonized definition of crises. We demonstrate that elevated perceptions of a country's riskiness are associated with significant falls in local asset prices and capital outflows, even after global financial conditions are controlled for. Increases in country risk are associated with reductions in firm-level investment and employment. We also show direct evidence of a novel type of contagion, where foreign risk is transmitted across borders through firm-level exposures. Exposed firms suffer falling market valuations and significantly retrench their hiring and investment in response to crises abroad. Finally, we provide direct evidence that heterogeneous currency loadings on global risk help explain the cross-country pattern of interest rates and currency risk premia.

scholarly journals The Global Impact of Brexit Uncertainty

2019 ◽  
pp. 1-60 ◽  
Author(s):  
Tarek A. Hassan ◽  
Laurence van Lent ◽  
Stephan Hollander ◽  
Ahmed Tahoun
Keyword(s):  
Computational Linguistics ◽  
Intention To Leave ◽  
The United States ◽  
Conference Calls ◽  
Firm Level ◽  
International Firms ◽  
Listed Firms ◽  
Quarterly Earnings ◽  
First Moment ◽  
The Impact

Using tools from computational linguistics, we construct new measures of the impact of Brexit on listed firms in the United States and around the world: the share of discussions in quarterly earnings conference calls on costs, benefits, and risks associated with the UK’s intention to leave the EU. Using this approach, we identify which firms expect to gain or lose from Brexit and which are most affected by Brexit uncertainty. We then estimate the effects of these different kinds of Brexit exposure on firm-level outcomes. We find that concerns about Brexit-related uncertainty extend far beyond British or even European firms. US and international firms most exposed to Brexit uncertainty have lost a substantial fraction of their market value and have reduced hiring and investment. In addition to Brexit uncertainty (the second moment), we find that international firms overwhelmingly expect negative direct effects of Brexit (the first moment), should it come to pass. Most prominently, firms expect difficulties resulting from regulatory divergence, reduced labor mobility, trade access, and the costs of adjusting their operations post-Brexit. Consistent with the predictions of canonical theory, this negative sentiment is recognized and priced in stock markets but has not yet had significant effects on firm actions.

Can Twitter Help Predict Firm-Level Earnings and Stock Returns?

2017 ◽  
Vol 93 (3) ◽  
pp. 25-57 ◽  
Author(s):  
Eli Bartov ◽  
Lucile Faurel ◽  
Partha S. Mohanram
Keyword(s):  
Stock Market ◽  
Stock Returns ◽  
Future Prospects ◽  
Traditional Media ◽  
Stock Trading ◽  
Firm Level ◽  
Quarterly Earnings ◽  
Announcement Returns ◽  
Twitter Activity ◽  
Original Information

ABSTRACT Prior research has examined how companies exploit Twitter in communicating with investors, and whether Twitter activity predicts the stock market as a whole. We test whether opinions of individuals tweeted just prior to a firm's earnings announcement predict its earnings and announcement returns. Using a broad sample from 2009 to 2012, we find that the aggregate opinion from individual tweets successfully predicts a firm's forthcoming quarterly earnings and announcement returns. These results hold for tweets that convey original information, as well as tweets that disseminate existing information, and are stronger for tweets providing information directly related to firm fundamentals and stock trading. Importantly, our results hold even after controlling for concurrent information or opinion from traditional media sources, and are stronger for firms in weaker information environments. Our findings highlight the importance of considering the aggregate opinion from individual tweets when assessing a stock's future prospects and value.

scholarly journals Beyond Computation: Information Technology, Organizational Transformation and Business Performance

2000 ◽  
Vol 14 (4) ◽  
pp. 23-48 ◽  
Author(s):  
Erik Brynjolfsson ◽  
Lorin M Hitt
Keyword(s):  
Business Performance ◽  
Organizational Transformation ◽  
Economic Value ◽  
Intangible Capital ◽  
Aggregate Productivity ◽  
Firm Level ◽  
The Past ◽  
Econometric Evidence ◽  
Definition Of ◽  
Value Of It

To understand the economic value of computers, one must broaden the traditional definition of both the technology and its effects. Case studies and firm-level econometric evidence suggest that: 1) organizational “investments” have a large influence on the value of IT investments; and 2) the benefits of IT investment are often intangible and disproportionately difficult to measure. Our analysis suggests that the link between IT and increased productivity emerged well before the recent surge in the aggregate productivity statistics and that the current macroeconomic productivity revival may in part reflect the contributions of intangible capital accumulated in the past.

scholarly journals Noncompliance with SEC regulations: evidence from timely loan disclosures

2021 ◽  
Author(s):  
Judson Caskey ◽  
Kanyuan Huang ◽  
Daniel Saavedra
Keyword(s):  
Interest Rates ◽  
Stock Prices ◽  
Investor Attention ◽  
Equity Analysts ◽  
Disclosure Rules ◽  
Asset Acquisition ◽  
Definition Of ◽  
Shed Light

AbstractWe use required 8-K filings around major borrowings to shed light on firms’ choices of whether to comply with SEC disclosure rules. Exploiting within-firm variation, we find that firms are more likely to hide loans with high spreads and tight financial covenants. We further find that firms appear to exploit the ambiguity of the definition of materiality, as they are more likely to selectively disclose (hide) “immaterial” loans when interest rates are low (high). Firms are less likely to hide loans when investors anticipate borrowing during asset acquisition, when firms are followed by more equity analysts or receive more investor attention, and when the firms’ stock prices are more volatile. Lastly, we provide evidence that the SEC does not rigorously enforce compliance with 8-K loan disclosures.

scholarly journals State Control, Marketization, And Firm Value: Evidence From China

2014 ◽  
Vol 30 (6) ◽  
pp. 1577 ◽  
Author(s):  
Kun Su ◽  
Rui Wan
Keyword(s):  
Panel Data ◽  
Firm Value ◽  
State Control ◽  
Negative Effects ◽  
Firm Level ◽  
Listed Firms ◽  
The Government ◽  
High Degree

<p>Using a firm-level panel data of Chinese listed firms, this paper examines the effects of state control on firm value and the different impacts that have under different degree of marketization deeply. The results show: compared with non-state controlled firms, state controlled firms are imposed by much policy burden and have more serious tunneling or expropriation behaviors. Therefore, firm values in state controlled firms are lower than in non-state controlled firms. For state controlled firms, the lower the government administrative ranks, the more serious the intervention or expropriation behaviors imposed by government, and thus the lower the firm value. Compared with low marketization regions, the negative effects of state control and low government administrative rank control on firm value is relatively smaller in regions with high degree of marketization.</p>

scholarly journals Monetary Policy Surprises over Time

2018 ◽  
Vol 08 (01) ◽  
pp. 1840002 ◽  
Author(s):  
Marcello Pericoli ◽  
Giovanni Veronese
Keyword(s):  
Monetary Policy ◽  
Financial Markets ◽  
Interest Rates ◽  
Euro Area ◽  
Yield Curve ◽  
Sovereign Spreads ◽  
Definition Of ◽  
Term Premia ◽  
The Impact ◽  
Over Time

We document how the impact of monetary surprises on euro-area and US financial markets has changed from 1999 to date. We use a definition of monetary policy surprises, which singles out movements in the long-end of the yield curve — rather than those changing nearby futures on the central bank reference rates. By focusing only on this component of monetary policy, our results are more comparable over time. We find a hump-shaped response of the yield curve to monetary policy surprises, both in the pre-crisis period and since 2013. During the crisis years, Fed path-surprises, largely through their effect on term premia, account for the impact on interest rates, which is found to be increasing in tenor. In the euro area, the path-surprises reflect the shifts in sovereign spreads, and have a large impact on the entire constellation of interest rates, exchange rates and equity markets.

Parliamentary privilege and defamation

1999 ◽  
Vol 58 (3) ◽  
pp. 461-499
Author(s):  
Nicholas Bamforth
Keyword(s):  
New Zealand ◽  
Direct Evidence ◽  
Bill Of Rights ◽  
Members Of Parliament ◽  
Domestic Courts ◽  
Wide Definition ◽  
The Times ◽  
Definition Of ◽  
Domestic Law ◽  
Court Of Appeal

IN the past five years, the conceptual ambiguities of Parliamentary privilege have come to haunt the courts with a vengeance. Ancient constitutional questions such as what constitutes a “proceeding” in Parliament and what counts as “questioning” a proceeding–encapsulated in colourful nineteenth-century cases like Stockdale v. Hansard (1839) 9 Ad.&E. 1, the Case of the Sheriff of Middlesex (1840) 11 Ad.&E. 273, and Bradlaugh v. Gossett (1884) 12 Q.B.D. 271–have been at the forefront of a clutch of recent decisions. In Prebble v. Television New Zealand [1995] 1 A.C. 321, the Privy Council gave new bite to Parliamentary privilege by ruling (in relation to the New Zealand Parliament) that it would be an abuse of both Article 9 of the 1689 Bill of Rights–which prohibits courts from questioning the freedom of speech and debates or proceedings in Parliament–and of a broader principle of mutuality of respect between Parliament and the judiciary, to allow any party to litigation to “bring into question anything said or done in the House by suggesting (whether by direct evidence, cross-examination, inference or submission) that the actions or words were inspired by improper motives or were untrue or misleading” (above, at 337). As a result, domestic courts stayed two libel actions brought by Members of Parliament, on the basis that the claims and defences involved raised issues whose investigation would infringe Parliamentary privilege (see, e.g., Allason v. Haines, The Times, 25 July 1995). Parliament responded by enacting section 13 of the Defamation Act 1996, allowing individual MPs to waive Parliamentary privilege in order to bring defamation actions. But in an apparent reassertion of the spirit of Prebble, the Court of Appeal expressly approved–albeit outside the context of defamation–the Privy Council's wide definition of privilege as a matter of domestic law (R. v. Parliamentary Commissioner for Standards, ex p. Fayed [1998] 1 W.L.R. 669, noted [1998] C.L.J. 6).

scholarly journals The effect of Islamic values on voluntary corporate governance disclosure

2017 ◽  
Vol 8 (2) ◽  
pp. 182-202 ◽  
Author(s):  
Waleed M. Albassam ◽  
Collins G. Ntim
Keyword(s):  
Corporate Governance ◽  
Fixed Effects ◽  
Future Research ◽  
Government Ownership ◽  
Firm Level ◽  
Content Type ◽  
Listed Firms ◽  
Alternative Measures ◽  
Islamic Values ◽  
Practical Implications

Purpose The study aims to examine the effect of Islamic values on the extent of voluntary corporate governance (CG) disclosure. In addition, the authors investigate the effect of traditional ownership structure and CG mechanisms on the extent of voluntary CG disclosure. Design/methodology/approach The authors distinctively construct Islamic values and voluntary CG disclosure indices using a sample of 75 Saudi-listed firms over a seven-year period in conducting multivariate regressions of the effect of Islamic values on the extent of voluntary CG disclosure. The analyses are robust to controlling for firm-level characteristics, fixed-effects, endogeneities and alternative measures. Findings The authors find that corporations that depict greater commitment towards incorporating Islamic values into their operations through high Islamic values disclosure index score engage in higher voluntary CG disclosures than those that are not. Additionally, the authors find that audit firm size, board size, government ownership, institutional ownership and the presence of a CG committee are positively associated with the level of voluntary CG disclosure, whereas block ownership is negatively associated with the extent of voluntary CG disclosure. Practical implications The study has clear practical implications for future research, practice and broader society by demonstrating empirically that corporations that voluntarily incorporate Islamic values into their operations are more likely to be transparent about their CG practices and thereby providing new crucial insights on the effect of Islamic values on voluntary CG compliance and disclosure. Originality/value This is the first empirical attempt at explicitly examining the effect of Islamic values on the extent of voluntary CG disclosure. The authors also offer evidence on the effect of traditional CG and ownership structures on the extent of voluntary CG disclosure.

scholarly journals Corporate Governance and Cost of Capital: Evidence from Emerging Market

Risks ◽  
2020 ◽  
Vol 8 (4) ◽  
pp. 104
Author(s):  
Muhammad Yar Khan ◽  
Anam Javeed ◽  
Ly Kim Cuong ◽  
Ha Pham
Keyword(s):  
Corporate Governance ◽  
Lower Cost ◽  
Cost Of Capital ◽  
Emerging Market ◽  
Firm Level ◽  
Listed Firms ◽  
Corporate Failure ◽  
Governance Index ◽  
Governance Practices ◽  
Code Of Corporate Governance

This study used a researcher self-constructed corporate governance index as a proxy to measure the firm-level corporate governance compliance and disclosure with the 2002 Pakistani Code of Corporate Governance, to examine the relationship between corporate governance and cost of capital. We found a negative and significant association between the Pakistani Corporate Governance Index (PCGI) and block ownership with the firm-level cost of capital. On average, better-governed Pakistani listed firms tend to be associated with a lower cost of capital than their poorly governed counterparts are. As an emerging market, good corporate governance practices are mainly related to minimise corporate failure and assist firms in attracting capital at a lower cost.

Accounting conservatism and money laundering risk

2020 ◽  
Vol 33 (2) ◽  
pp. 343-361
Author(s):  
Meysam Bolgorian ◽  
Ali Mayeli
Keyword(s):  
Money Laundering ◽  
Stock Exchange ◽  
Risk Measure ◽  
Negative Relationship ◽  
Accounting Conservatism ◽  
Firm Characteristics ◽  
Firm Level ◽  
Content Type ◽  
Listed Firms ◽  
Specific Effects

Purpose This paper aims to investigate the relationship between accounting conservatism and money laundering risk. For this goal, the authors construct an index for measuring money laundering risk at the firm level for Iranian listed firms in the Tehran Stock Exchange. Design/methodology/approach In this study, the authors use a sample of 924 firm-year observation of Iranian listed firms for the period of 2012-2017. The authors use three approaches for testing our prediction that more conservative firms are less likely to be involved in money laundering activities. A balanced panel regression model has been used for testing the prediction. Findings The paper results suggest that there is a negative relationship between conditional conservatism and money laundering risk. Furthermore, the authors have shown that the result is robust to controlling for different firm characteristics variables and also industry specific effects. Research limitations/implications Further research in other financial markets is needed to confirm the results generally. Practical implications The evidence in this paper indicates that the degree of accounting conservatism contains important information which can be used by the investors and regulators for managing and controlling the risk of money laundering in the firms. Originality/value By constructing a money laundering risk measure at the firm level for the first time, the authors provide evidence on relationship between conservatism and money laundering risk in Iran.

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