Managerial ownership dynamics and firm value

From 1988 to 2003, the average change in managerial ownership is significantly negative every year for American firms. We find that managers are more likely to significantly decrease their ownership when their firms are performing well, but not more likely to increase their ownership when their firms have poor performance. Because investors learn about the total change in managerial ownership with a lag, changes in Tobin's q in a period can be affected by changes in managerial ownership in the previous period. In an efficient market, it is unlikely that changes in managerial ownership in one period are caused by future changes in q. When controlling for past stock returns, we find that large increases in managerial ownership increase q. This result is driven by increases in shares held by officers, while increases in shares held by directors appear unrelated to changes in firm value. There is no evidence that large decreases in ownership have an adverse impact on firm value. We argue that our evidence cannot be wholly explained by existing theories and propose a managerial discretion theory of ownership consistent with our evidence.Firm valuation, director and officer ownership, ownership dynamics

Why do large shareholders adopt a short-term versus a long-term investment horizon in different firms?

I ask why the same large shareholders have different investment horizons. Using data for 1998–2013, I examine four fundamental firm policies for their potential influence on blockholders’ investments with different time horizons. The panel ordinary least squares, difference‐in‐difference (using the Sarbanes‐Oxley Act), logistic, and dynamic generalized method of moments regression analyses reveal that blockholders adopt a short‐term horizon in smaller firms with a less independent board, high leverage, and high dividends while the same blockholders keep their investments longer in firms with a more independent board and low dividends. Under various economic conditions, different firm characteristics gain importance in blockholders’ decision on short‐term versus long‐term investments

Factors Impacting Capital Expenditures in the Quick Service Restaurant Industry

The purpose of this article is to study the factors that impact capital expenditures in the quickservice restaurant industry. The authors hypothesize that growth opportunities, free cash flow, size, corporate earnings, economic conditions, and franchising status will have impact on the capital expenditures of quick-service restaurants. This study analyzed capital expenditure and other financial data on quick service restaurants for the period 2006–2016. Results suggest that corporate earnings, size, cash flow, economic conditions, and franchising have a significant relationship with capital expenditures, while growth opportunities are not associated with capital expenditures. Specifically, a high degree of corporate earnings, large size, and a high degree of cash flow tend to be associated with a high degree of capital expenditures; while favorable economic conditions and franchising tend to be associated with a low level of capital expenditures

Target company cross-border effects in acquisitions into the UK

We analyse the abnormal returns to target shareholders in crossborder and domestic acquisitions of UK companies. The crossborder effect during the bid month is small (0.84%), although crossborder targets gain significantly more than domestic targets during the months surrounding the bid. We find no evidence for the level of abnormal returns in crossborder acquisitions to be associated with market access or exchange rate effects, and only limited support for an international diversification effect. However, the crossborder effect appears to be associated with significant payment effects, and there is no significant residual crossborder effect once various bid characteristics are controlled for

Peculiarities of selecting the gearboxes and wheel shift coefficients in the optimization of drive gear transmissions

В якості вузлового моменту оптимізаційного проектування тягових зубчастих передач залізничного рухомого складу виділено процедуру обґрунтованого вибору коефіцієнтів зміщення шестерень і коліс за рахунок використання відповідних блокувальних контурів. Обґрунтовано актуальність досліджень з розроблення методичного забезпечення для раціонального отримання блокувальних контурів при проектуванні тягових зубастих передач. Представлені розроблені математичні залежності, що пов’язують фіксовані величині обмежувальних і контрольованих параметрів передач з числами зубців і коефіцієнтами зміщення шестерні та колеса. Їх використання дозволяє отримувати конкретні блокувальні контури для вибору коефіцієнтів зміщення шестерні та колеса при оптимізаційному проектуванні тягових зубчастих передач з різними початковими параметрами. Наведено приклад практичної реалізації розроблених математичних залежностей при отриманні блокувального контуру для вибору коефіцієнтів зміщення шестерні та колеса тягової зубчастої передачі сучасного магістрального вантажного тепловозу. Зроблено висновок про доцільність використання запропонованого методичного забезпечення при оптимізаційному проектуванні тягових зубчатих передач.As a key point in the optimization design of traction gears of the railway rolling stock, a procedure for a reasonable choice of the coefficients for the displacement of gears and wheels is provided by using the appropriate blocking circuits. The relevance of studies on the development of methodological support for the rational production of blocking contours in the design of traction-toothed gears is substantiated. The developed mathematical dependences connecting the fixed values of the limiting and controlled parameters of the gears with the numbers of the teeth and the gearing coefficients of the gears and wheels are presented. Their use makes it possible to obtain specific blocking contours for the selection of gear and wheel bias coefficients in the optimization design of traction gears with different initial parameters. An example of the practical implementation of the developed mathematical dependencies in obtaining a blocking contour for selecting the gear displacement coefficients and the traction gear wheel of a modern mainline freight locomotive is given. The conclusion is made about the expediency of using the proposed methodological support in the optimization design of traction gears

Appointing Women to Boards: Is There a Cultural Bias?

Companies that are serious about corporate governance and business ethics are turning their attention to gender diversity at the most senior levels of business (Institute of Business Ethics, Business Ethics Briefing 21:1, 2011). Board gender diversity has been the subject of several studies carried out by international organizations such as Catalyst (Increasing gender diversity on boards: Current index of formal approaches, 2012), the World Economic Forum (Hausmann et al., The global gender gap report, 2010), and the European Board Diversity Analysis (Is it getting easier to find women on European boards? 2010). They all lead to reports confirming the overall relatively low proportion of women on boards and the slow pace at which more women are being appointed. Furthermore, the proportion of women on corporate boards varies much across countries. Based on institutional theory, this study hypothesizes and tests whether this variation can be attributed to differences in cultural settings across countries. Our analysis of the representation of women on boards for 32 countries during 2010 reveals that two cultural characteristics are indeed associated with the observed differences. We use the cultural dimensions proposed by Hofstede (Culture’s consequences: International differences in work-related values, 1980) to measure this construct. Results show that countries which have the greatest tolerance for inequalities in the distribution of power and those that tend to value the role of men generally exhibit lower representations of women on boards

A note on the pricing of multivariate contingent claims under a transformed-gamma distribution

We develop a framework for pricing multivariate European-style contingent claims in a discrete-time economy based on a multivariate transformed-gamma distribution. In our model, each transformed-gamma distributed underlying asset depends on two terms: a idiosyncratic term and a systematic term, where the latter is the same for all underlying assets and has a direct impact on their correlation structure. Given our distributional assumptions and the existence of a representative agent with a standard utility function, we apply equilibrium arguments and provide sufficient conditions for obtaining preference-free contingent claim pricing equations. We illustrate the applicability of our framework by providing examples of preference-free contingent claim pricing models. Multivariate pricing models are of particular interest when payoffs depend on two or more underlying assets, such as crack and crush spread options, options to exchange one asset for another, and options with a stochastic strike price in general

Addition of Amines to a Carbonyl Ligand: Syntheses, Characterization, and Reactivities of Iridium(III) Porphyrin Carbamoyl Complexes

Treatment of (carbonyl)chloro(meso-tetra-p-tolylporphyrinato)iridium(III), (TTP)Ir(CO)Cl (1), with excess primary amines at 23 °C in the presence of Na2CO3 produces the trans-amine-coordinated iridium carbamoyl complexes (TTP)Ir(NH2R)[C(O)NHR] (R = Bn (2a), n-Bu (2b), i-Pr (2c), t-Bu (2d)) with isolated yields up to 94%. The trans-amine ligand is labile and can be replaced with quinuclidine (1-azabicyclo[2.2.2]octane, ABCO), 1-methylimidazole (1-MeIm), triethyl phosphite (P(OEt)3), and dimethylphenylphosphine (PMe2Ph) at 23 °C to afford the hexacoordinated carbamoyl complexes (TTP)Ir(L)[C(O)NHR] (for R = Bn: L = ABCO (3a), 1-MeIm (4a), P(OEt)3 (5a), PMe2Ph (6a)). On the basis of ligand displacement reactions and equilibrium studies, ligand binding strengths to the iridium metal center were found to decrease in the order PMe2Ph \u3e P(OEt)3 \u3e 1-MeIm \u3e ABCO \u3e BnNH2 ≫ Et3N, PCy3. The carbamoyl complexes (TTP)Ir(L)[C(O)NHR] (L = RNH2 (2a,b), 1-MeIm (4a)) undergo protonolysis with HBF4 to give the cationic carbonyl complexes [(TTP)Ir(NH2R)(CO)]BF4 (7a,b) and [(TTP)Ir(1-MeIm)(CO)]BF4 (8), respectively. In contrast, the carbamoyl complexes (TTP)Ir(L)[C(O)NHR] (L = P(OEt)3 (5a), PMe2Ph (6a,c)) reacted with HBF4 to afford the complexes [(TTP)Ir(PMe2Ph)]BF4 (9) and [(TTP)IrP(OEt)3]BF4 (10), respectively. The carbamoyl complexes (TTP)Ir(L)[C(O)NHR] (L = RNH2 (2a–d), 1-MeIm (4a), P(OEt)3 (5b), PMe2Ph (6c)) reacted with methyl iodide to give the iodo complexes (TTP)Ir(L)I (L = RNH2 (11a–d), 1-MeIm (12), P(OEt)3(13), PMe2Ph (14)). Reactions of the complexes [(TTP)Ir(PMe2Ph)]BF4 (9) and [(TTP)IrP(OEt)3]BF4 (10) with [Bu4N]I, benzylamine (BnNH2), and PMe2Ph afforded (TTP)Ir(PMe2Ph)I (14), (TTP)Ir[P(OEt)3]I (13), [(TTP)Ir(PMe2Ph)(NH2Bn)]BF4 (16), and trans-[(TTP)Ir(PMe2Ph)2]BF4 (17), respectively. Metrical details for the molecular structures of 4a and17 are reported