ACQUISITIONS OF PRIVATE VERSUS PUBLIC FIRMS: THE ROLE OF PRIVATE INFORMATION ON ACQUIRER RETURNS.

2006 ◽  
Vol 2006 (1) ◽  
pp. T1-T6
Author(s):  
Jung-Chin Shen
Keyword(s):  
Private Information ◽  
Public Firms

Do Targets Benefit From Auctions? The Role of Private Information

2012 ◽  
Author(s):  
Carol Anilowski Cain ◽  
Antonio J. Macias ◽  
Juan Manuel Sanchez
Keyword(s):  
Private Information

scholarly journals Honest Equilibria in Reputation Games: The Role of Time Preferences

2018 ◽  
Vol 10 (1) ◽  
pp. 278-314 ◽  
Author(s):  
Melis Kartal
Keyword(s):  
Private Information ◽  
Repeated Games ◽  
Broad Class ◽  
Time Preferences ◽  
Reputation Games

New relationships are often plagued with uncertainty because one of the players has some private information about her “type.” The reputation literature has shown that equilibria that reveal this private information typically involve breach of trust and conflict. But are these inevitable for equilibrium learning? I analyze self-enforcing relationships where one party is privately informed about her time preferences. I show that there always exist honest reputation equilibria, which fully reveal information and support cooperation without breach or conflict. I compare these to dishonest reputation equilibria from several perspectives. My results are applicable to a broad class of repeated games. (JEL C73, D82, D83, D86, Z13)

scholarly journals Children and Online Privacy Protection: Empowerment from Cognitive Defense Strategies

2019 ◽  
Vol 39 (2) ◽  
pp. 205-219 ◽  
Author(s):  
J. Craig Andrews ◽  
Kristen L. Walker ◽  
Jeremy Kees
Keyword(s):  
Private Information ◽  
Parental Influence ◽  
Online Privacy ◽  
State Agencies ◽  
Educational Video ◽  
Defense Strategies ◽  
Education Campaigns ◽  
Defense Research ◽  
Limit Access

At present, very little is known about what might encourage children and teens to limit access to their private information online and to restrict what they share on social media and video sites. Federal and state agencies face challenges encouraging companies to help children, teens, and parents protect their information online. The authors extend previous cognitive defense research by examining (1) effects beyond advertising as applied to information privacy online; (2) not only children’s/teens’ beliefs and knowledge, but also their online privacy decisions; (3) multiple age categories; (4) multiple cognitive defense strategies (educational video, quiz with feedback, or absence of a strategy); and (5) children’s/teens’ motivation to restrict what they share online. Key results indicate significant effects of the quiz and educational video over the absence of a strategy in enhancing favorable online safety beliefs and in restricting online sharing. Findings also demonstrate the role of perceived parental influence and for agencies to offer privacy education campaigns to help empower children to protect their privacy. Implications for policy and privacy research are discussed.

Do IRS Audits Deter Corporate Tax Avoidance?

2012 ◽  
Vol 87 (5) ◽  
pp. 1603-1639 ◽  
Author(s):  
Jeffrey L. Hoopes ◽  
Devan Mescall ◽  
Jeffrey A. Pittman
Keyword(s):  
Tax Avoidance ◽  
Tax Rates ◽  
Coefficient Estimates ◽  
Corporate Tax ◽  
Effective Tax Rates ◽  
Tax Enforcement ◽  
Public Firms ◽  
Large Samples ◽  
Percentage Points

ABSTRACT We extend research on the determinants of corporate tax avoidance to include the role of Internal Revenue Service (IRS) monitoring. Our evidence from large samples implies that U.S. public firms undertake less aggressive tax positions when tax enforcement is stricter. Reflecting its first-order economic impact on firms, our coefficient estimates imply that raising the probability of an IRS audit from 19 percent (the 25th percentile in our data) to 37 percent (the 75th percentile) increases their cash effective tax rates, on average, by nearly two percentage points, which amounts to a 7 percent increase in cash effective tax rates. These results are robust to controlling for firm size and time, which determine our primary proxy for IRS enforcement, in different ways; specifying several alternative dependent and test variables; and confronting potential endogeneity with instrumental variables and panel data estimations, among other techniques. JEL Classifications: M40; G34; G32; H25.

scholarly journals Earnings Smoothing as Information Signaling or Garbling: A Review of Literature

2018 ◽  
Vol 10 (1) ◽  
pp. 131
Author(s):  
Nor Afifah Shabani ◽  
Saudah Sofian
Keyword(s):  
Private Information ◽  
Firm Value ◽  
Future Research ◽  
Journal Articles ◽  
Actual Performance ◽  
Future Earnings ◽  
Information Signaling ◽  
Earnings Smoothing ◽  
Reported Earnings

Earnings smoothing, which refers to the action of managers managing earnings to reduce fluctuations of reported earnings, is a special type of earnings management because while earnings smoothing may be used to distort shareholders and creditors’ view of corporate actual performance, it may also serve as a tool to communicate corporate private information of future earnings to the aforementioned stakeholders. Hence, it comes to no surprise when prior literatures reveal that the studies on the role of earnings smoothing are divided into two streams: as information signaling and information garbling. This paper aims to review prior literatures, specifically on the role of earnings smoothing either as information signaling or garbling based on four themes: firm value, financing need, compensation contract and outsiders’ intervention. This paper reviews journal articles gathered from Web of Science database. Based on the shortcomings of prior literatures, this paper highlights avenue for future research.

scholarly journals Learning from prices: information aggregation and accumulation in an asset market

2020 ◽  
Author(s):  
Michele Berardi
Keyword(s):  
Private Information ◽  
Dynamic Properties ◽  
Public Information ◽  
Information Aggregation ◽  
Time Varying ◽  
Private Signals ◽  
Private And Public ◽  
Fundamental Value ◽  
Over Time

Abstract Can prices convey information about the fundamental value of an asset? This paper considers this problem in relation to the dynamic properties of the fundamental (whether it is constant or time-varying) and the structure of information available to agents. Risk-averse traders receive two potential signals each period: one exogenous and private and the other, prices, endogenous and public. Prices aggregate private information but include aggregate noise. Information can accumulate over time both through endogenous and exogenous signals. With a constant fundamental, the precision of both private and public cumulative information increases over time but agents put progressively more weight on the endogenous signals, asymptotically disregarding private ones. If the fundamental is time-varying, the use of past private signals complicates the role of prices as a source of information, since it introduces endogenous serial correlation in the price signal and cross-correlation between it and innovations in the fundamental. A modified version of the Kalman filter can still be used to extract information from prices and results show that the precision of the endogenous signals converges to a constant, with both private and public information used at all times.

scholarly journals The Information Role of Earnings Conference Call Tone: Evidence from Stock Price Crash Risk

2019 ◽  
Author(s):  
Xi Fu ◽  
Xiaoxi Wu ◽  
Zhifang Zhang
Keyword(s):  
Stock Price ◽  
Predictive Power ◽  
Crash Risk ◽  
Conference Calls ◽  
Conference Call ◽  
Public Firms ◽  
Equity Incentives ◽  
Disclosure Tone

Abstract This paper investigates whether and how the disclosure tone of earnings conference calls predicts future stock price crash risk. Using US public firms’ conference call transcripts from 2010 to 2015, we find that firms with less optimistic tone of year-end conference calls experience higher stock price crash risk in the following year. Additional analyses reveal that the predictive power of tone is more pronounced among firms with better information environment and lower managerial equity incentives, suggesting that extrinsic motivations for truthful disclosure partially explain the predictive power of conference call tone. Our results shed light on the long-term information role of conference call tone by exploring the setting of extreme future downside risk, when managers have conflicting incentives either to unethically manipulate disclosure tone to hide bad news or to engage in ethical and truthful communication.

scholarly journals Venture Capital and Financial Reporting in Newly Public Firms

2018 ◽  
pp. 411-429
Author(s):  
Lars Helge Hass ◽  
Monika Tarsalewska
Keyword(s):  
Earnings Management ◽  
Empirical Evidence ◽  
Financial Reporting ◽  
Reporting Quality ◽  
Active Role ◽  
Real Earnings Management ◽  
Venture Capitalists ◽  
Public Firms ◽  
Reporting Practices

Financial intermediaries such as venture capitalists (VCs) not only provide financing, they also play an active role in firm governance and in financial practices before a firm goes public. Venture capitalists are actively engaged in monitoring and advising their portfolio firms. Thus, one also expects them to exert significant influence over the development of financial reporting practices. This chapter reviews recent literature and empirical evidence on VCs and financial reporting quality in newly public firms. It surveys the role of VCs in such activities as earnings management. In particular, it discusses how their monitoring activities and reputation can impact how their portfolio firms establish financial reporting practices. Subsequently, it also reviews the consequences of misreporting, and whether they affect VC behavior ex ante. Finally, the chapter uses recent data to provide empirical evidence on the effect of VCs on accrual and real earnings management.

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