Georgetown University McDonough School of Business Research Paper Series最新文献

{"title":"The Evolution of Judicial Standards: Evidence from Litigated Merger Trials","authors":"Jeffrey T. Macher, J. Mayo, D. Sappington, M. Whitener","doi":"10.2139/ssrn.3809174","DOIUrl":"https://doi.org/10.2139/ssrn.3809174","url":null,"abstract":"Monday-morning assessments of antitrust merger trial outcomes are common. Critics of a court decision blocking a merger may opine that the outcome is an indication that the judiciary has become overzealous in its interpretation of the Clayton Act’s prohibition of mergers whose effects “may be to substantially lessen competition, or tend to create a monopoly.” Similarly, in the wake of an adjudicated merger that is allowed to proceed, critics may argue that the judiciary has become too lax in its interpretation of the Clayton Act. Less common are attempts to systematically assess the body of merger outcomes to determine judicial trends and tendencies. This void is particularly salient because in recent years a substantive narrative has emerged that judicial application of the antitrust laws — overly influenced by the Chicago School — has become increasingly hostile toward antitrust authorities’ (Agencies’) challenges of mergers over time. A corollary of this narrative is the claim that the shifting composition of the judges hearing merger cases has also contributed to the propensity of the courts to deny the Agencies’ merger challenges.<br><br>In this paper, we first describe the historical context within which the current narrative has arisen. Although this narrative builds upon certain developments in merger enforcement over the years, we find that a more complete assessment of the evolution of merger enforcement and judicial outcomes yields a substantially more ambiguous interpretation of the evolution of judicial standards than has been proffered. That is, the current narrative does not provide an unambiguous basis upon which to draw conclusions regarding shifts in judicial standards in litigated merger cases. Given this ambiguity, the paper then develops a theoretical model designed to capture the essence of the interplay among merging firms, antitrust authorities and the courts. The model yields clear predictions on shifts in judicial standards from the outcomes of both litigated mergers cases and those that settle prior to trial. <br><br>The paper then provides an empirical investigation of litigated merger outcomes based on the population of all merger challenges in the United States over 1979-2019. Two-stage econometric methods are employed to account for the potential that the set of litigated mergers is a non-random sample of all merger challenges. This empirical analysis reveals that, contrary to the current narrative, judicial standards have shifted in favor of the Agencies over time. The probability that merger challenges proceed to trial has declined over time while the probability that antitrust agencies win trials has increased over time — both results are indicative of judicial standards applied to merger challenges that have grown increasingly pro-enforcement over time. We find no statistically significant evidence that the outcomes of antitrust merger cases vary according to whether the judges involved were appointed by Republi","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"20 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-03-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131852355","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Labor Force Telework Flexibility and Asset Prices: Evidence from the COVID-19 Pandemic","authors":"Jack Y Favilukis, Xiaoji Lin, Ali Sharifkhani, Xiaofei Zhao","doi":"10.2139/ssrn.3693239","DOIUrl":"https://doi.org/10.2139/ssrn.3693239","url":null,"abstract":"We show that labor force telework flexibility (LFTF) is a first-order effect in accounting for the variations of asset prices and firm policies during the COVID-19 pandemic. Specifically, firms in high LFTF industries significantly outperform firms in low LFTF industries in stock returns. The positive LFTF-return relation extends to G7 countries and is stronger in countries with more severe pandemic. A decomposition analysis of the LFTF measure shows that the job characteristics associated with the central component of telework, information and communication technologies, are the main driving force of the result. A dynamic neoclassical model of firms operating multiple job tasks together with pandemic shocks captures the positive relationship between labor force flexibility and stock returns. The model mechanism highlights that i) job task flexibility is a key driving force of the cross-industry heterogeneity in firm value fluctuations, and ii) combining labor productivity (supply) and uncertainty shocks is crucial to generate the large drop and persistent recovery in firm value and output.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"149 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-10-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"115585739","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Pricing of New Corporate Debt Issues","authors":"Kelly Nianyun Cai, K. Hanley, A. Huang, Xiaofei Zhao","doi":"10.2139/ssrn.3700162","DOIUrl":"https://doi.org/10.2139/ssrn.3700162","url":null,"abstract":"Using computational linguistics, we examine whether risk factor disclosure in the offering prospectus provides unique information in the pricing of initial public offerings of bonds. Both credit ratings and initial yields are related to risks that discuss the financial condition of the firm, its indebtedness, covenants, and repayment. Aftermarket yields are more sensitive to risk when traded in the Rule 144A private market than in the publicly-traded market. However, the effect of disclosure on bond outcomes is similar for both public and private firms in either market. Thus, mandated disclosure provides valuable information to both public and private market participants.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"152 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-09-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"117162155","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Do the Rich Gamble in the Stock Market? Low Risk Anomalies and Wealthy Households","authors":"Turan G. Bali, A. D. Gunaydin, T. Jansson, Yigitcan Karabulut","doi":"10.2139/ssrn.3664501","DOIUrl":"https://doi.org/10.2139/ssrn.3664501","url":null,"abstract":"We propose a low risk anomaly (LRA) index with high values indicating high-risk stocks with high-beta, high-volatility, and high-lottery-payoffs. We document a significantly negative cross-sectional relation between the LRA index and future returns on individual stocks trading in the U.S. and international countries. We show that the high-LRA stocks are subject to significant overpricing and primarily held by retail investors, whereas the degree of underpricing of low-LRA stocks is so small that the low risk anomaly is driven by retail investors’ demand for high-LRA stocks, leading to temporary overpricing and negative future abnormal returns for these high-beta, high-volatility stocks with large lottery payoffs. To understand how and why individual investors contribute to the low risk anomalies, we use a large-scale individual-level panel dataset from Sweden that allows us to directly observe the stock investments of the entire population at the individual security level. We find that the anomalous negative relation between risk and future abnormal returns is only confined to those stocks held by rich households, whereas there is no evidence of low risk anomaly for stocks held by non-rich households and institutional investors. Further tests also reveal that the skewness preferences of rich households have the potential to explain the demand of wealthy investors for high-risk stocks. In contrast, other potential explanations such as the overconfidence-based preferences, constraints on financial leverage, downside risk, and hedging demand receive little support from the data.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"491 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-07-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128614170","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Design of Electricity Demand-Response Programs","authors":"Vishal V. Agrawal, Şafak Yücel","doi":"10.2139/ssrn.3659574","DOIUrl":"https://doi.org/10.2139/ssrn.3659574","url":null,"abstract":"During a heat wave on a summer afternoon, a utility firm may face unusually high demand and procurement cost for electricity. Under such conditions, a demand-response event occurs, and the firm asks residential customers to reduce their demand. Such a demand-response program not only reduces the firm’s procurement cost, but it can also be environmentally beneficial by reducing generation from emissions-intensive power plants. In a demand-response program, a utility firm pays a rebate to customers for each unit of their demand reduction—the difference between a customer’s demand and consumption. However, the demand reduction cannot be directly measured because the firm cannot observe the customer’s demand, but only its consumption. Accordingly, a utility firm estimates the demand reduction by subtracting the consumption from a baseline, which is typically set as a customer’s average historical demand. In this paper, we first investigate how the existence of a baseline influences a customer’s demand reduction decision and when it leads to under- or overestimation of the actual demand reduction. We then analyze how a utility firm should adjust the baseline from the customer’s average demand. We find that it should inflate (deflate) the baseline if the cost difference between event and non-event periods is large (small), even though this may lead to greater overestimation (underestimation) of the customer’s demand reduction. Interestingly, we show that inflation of the baseline, which one would expect to make reducing demand more attractive for a customer, can actually lead to a smaller demand reduction, resulting in higher emissions. This paper was accepted by Vishal Gaur, operations management.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-07-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128348322","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Evolution of Merger Enforcement Intensity: What Do the Data Show?","authors":"J. Mayo, Jeffrey T. Macher","doi":"10.2139/ssrn.3651485","DOIUrl":"https://doi.org/10.2139/ssrn.3651485","url":null,"abstract":"\u0000 A growing narrative has arisen that antitrust regulators have systematically relaxed enforcement over time. This narrative has led to calls for reinvigorated enforcement and the passage of new tougher antitrust legislation. In this paper, we employ data drawn directly from the antitrust agencies to examine this claim. Data collected from 1979 to 2017 indicate that, contrary to the popular narrative, regulators have become more likely to challenge proposed mergers over time. Controlling for the number of merger proposals submitted to the agencies, the likelihood of a merger challenge has more than doubled over this period. After remaining relatively constant over previous administrations, merger enforcement intensity (MEI) rose in the G.W. Bush and even more so in the Obama administrations. The data also reveal that MEI is positively influenced by the agency budget size. Were historical enforcement tendencies to continue, a ten percent increase in the agencies’ budgets would yield an eight percent increase in merger challenges. This finding suggests that, independent of any statutory changes to existing antitrust laws, variation in agency budgets provides a viable pathway to enhanced merger enforcement.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"16 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-07-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122215834","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Worker Redeployment in Multi-Business Firms","authors":"Jasmina Chauvin, Christopher W. Poliquin","doi":"10.2139/ssrn.3614269","DOIUrl":"https://doi.org/10.2139/ssrn.3614269","url":null,"abstract":"We examine to what extent and when multi-business firms internally redeploy workers between their units. Research has emphasized that resource redeployment creates value by allowing firms to escape from declining industries to those with better prospects. We find multiple patterns consistent with this mechanism. However, we also find, surprisingly, that more than half of all redeployments occur between establishments in the same five-digit industry. Moreover, redeployment is often not associated with business exit or diversification, but rather, the opening of new establishments in industries that are growing within the firm. We argue that these patterns are consistent with the theoretical notion of \"internal inducements\" to redeployment. Overall, our findings suggest redeployment creates value not only in the process of diversification but also horizontal growth.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"20 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-06-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127711020","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Stochastic Dominance in Mutual Fund Returns","authors":"Lei Jiang, Quan Wen, Ke Wu, Mengfan Yin","doi":"10.2139/ssrn.3541062","DOIUrl":"https://doi.org/10.2139/ssrn.3541062","url":null,"abstract":"We find that a large portion of U.S. equity mutual funds almost second-order stochastically dominates the market portfolio. Consistent with the canonical definition of second-order stochastic dominance, both fund investors and managers reveal their preference for funds with a higher degree of almost second-order stochastic dominance through higher inflows and higher manager ownership. Funds with a higher degree of stochastic dominance over the market portfolio significantly outperform their peers, after controlling for common performance predictors and the Sharpe ratio. Inference based on stochastic dominance is more consistent with the Manipulation-Proof Performance Measure (MPPM) than with the Sharpe ratio.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"197 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132851540","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Unearthing Zombies","authors":"Nirupama Kulkarni, S. Ritadhi, Siddharth Vij, Katherine Waldock","doi":"10.2139/ssrn.3495660","DOIUrl":"https://doi.org/10.2139/ssrn.3495660","url":null,"abstract":"Since ineffective debt resolution perpetuates zombie lending, bankruptcy reform has emerged as a solution. We show, however, that lender-based frictions can limit reform impact. Exploiting a unique empirical setting and novel supervisory data from India, we document that a new bankruptcy law had muted effects on lenders recognizing zombie borrowers as non-performing. A subsequent unexpected regulation, targeting perverse lender incentives to continue concealing zombies, increased zombie recognition particularly for undercapitalized and government-owned banks, highlighting the role of bank capital and political frictions in sustaining zombie lending. Resolving zombie loans allowed lenders to reallocate credit to healthier borrowers who increased investment.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-11-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125720133","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Blockchain: Security and Confidentiality.","authors":"G. Hilary","doi":"10.2139/ssrn.3327248","DOIUrl":"https://doi.org/10.2139/ssrn.3327248","url":null,"abstract":"The study reviews different security and confidentiality issues created by the development of blockchain and other related distributed ledger technologies. Implications for law enforcement agencies are considered.","PeriodicalId":322512,"journal":{"name":"Georgetown University McDonough School of Business Research Paper Series","volume":"33 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121237015","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}