Accounting and Finance - Journal Articles
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Item US efficient factors in a Bayesian model scan framework(Emerald Publishing Ltd., 2024-01-15) O'Connell, MichaelPurpose: The author examines the impact these efficient factors have on factor model comparison tests in US returns using the Bayesian model scan approach of Chib et al. (2020), and Chib et al.(2022). Design/methodology/approach: Ehsani and Linnainmaa (2022) show that time-series efficient investment factors in US stock returns span and earn 40% higher Sharpe ratios than the original factors. Findings: The author shows that the optimal asset pricing model is an eight-factor model which contains efficient versions of the market factor, value factor (HML) and long-horizon behavioral factor (FIN). The findings show that efficient factors enhance the performance of US factor model performance. The top performing asset pricing model does not change in recent data. Originality/value: The author is the only one to examine if the efficient factors developed by Ehsani and Linnainmaa (2022) have an impact on model comparison tests in US stock returns.Item Market manipulation rules and IPO underpricing(Elsevier, 2020-12-31) Duong, Huu Nhan; Goyal, Abhinav; Kallinterakis, Vasileios; Veeraraghavan, MadhucoraUsing a large sample of 13,459 initial public offerings (IPOs) from 37 countries, we find that trading rules on market manipulation reduce IPO underpricing. The effect is weaker for IPOs certified by reputable intermediaries, in countries with greater shareholder rights protection, better financial reporting quality, and after the adoption of International Financial Reporting Standards. Better trading rules on market manipulation are also related to higher IPO proceeds, subscription-level, and trading volume, lower IPO listing fees, and better long-term post-IPO performance. Our findings are consistent with the notion that exchange trading rules mitigate information asymmetry problems for investors, resulting in lower IPO underpricing.Item Terrorist attacks, investor sentiment, and the pricing of initial public offerings(Elsevier, 2020-11-07) Chen, Yangyang; Goyal, Abhinav; Veeraraghavan, Madhu; Zolotoy, LeonUsing terrorist attacks as exogenous shocks to investor sentiment, we study the impact of investor sentiment on initial public offering (IPO) pricing. IPOs listed within the 30-day period following terrorist attacks, on average, experience lower first-day returns. The documented impact of terrorist attacks is magnified when there is greater IPO valuation uncertainty and when the terrorist attacks are more salient to investors, while mitigated for IPOs “certified” by reputable intermediaries. We also show that the affected IPOs, on average, have more pessimistic media tone in the post-attack/pre-listing day period. The affected IPOs also tend to have lower levels of price revisions, subscriptions, primary share revisions, and total proceeds. Collectively, our findings underscore the salience of investor sentiment in shaping IPO outcomes.Item Out of pocket or out of control: A qualitative analysis of healthcare professional stakeholder involvement in pharmaceutical policy change in Ireland(Elsevier B.V., 2020-02-28) O'Brien, Gary L.; Sinnott, Sarah-Jo; O'Flynn, Bridget; Walshe, Valerie; Mulcahy, Mark; Byrne, Stephen; Irish Research CouncilBackground: Mandatory co-payments attached to prescription medicines on the Irish public health insurance [General Medical Services (GMS)] scheme have undergone multiple iterations since their introduction in October 2010. To date, whilst patients’ opinions on said co-payments have been evaluated, the perspectives of community pharmacists and general practitioners (GPs) have not. Objective: To explore the involvement and perceptions of community pharmacists and GPs on this pharmaceutical policy change. Methods: A qualitative study using purposive sampling alongside snowballing recruitment was used. Nineteen interviews were conducted in a Southern region of Ireland. Data were analysed using the Framework Approach. Results: Three major themes emerged: 1) the withered tax-collecting pharmacist; 2) concerns and prescribing patterns of physicians; and 3) the co-payment system – impact and sustainability. Both community pharmacists and GPs accepted the theoretical concept of a co-payment on the GMS scheme as it prevents moral hazard. However, there were multiple references to the burden that the current method of co-payment collection places on community pharmacists in terms of direct financial loss and reductions in workplace productivity. GPs independently suggested that a co-payment system may inhibit moral hazard by GMS patients in the utilisation of GP services. It was unclear to participants what evidence is guiding the GMS co-payment fee changes. Conclusion: Interviewees accepted the rationale for the co-payment system, but reform is warranted.Item Cash dividends and investor protection in Asia(Elsevier, 2013-03-26) Goyal, Abhinav; Muckley, Cal B.We study the importance of investor rights in payout policy determination in Asia, using a sample of up to 52,778 firm years. The listed Asian firms located in relatively high investor protection, common law countries, have a greater tendency to payout and, if they do so, they tend to pay out more. We also examine the importance of distinctive creditor and minority shareholder rights in respect to payout policy determination. In our study of a variety of payout events (decisions to pay out, to initiate or omit payout and to markedly increase or decrease payout), we show that this set of payout events is principally determined by competing creditor and minority shareholder rights, rather than managerial sought reputation related effects, to diminish the cost of capital. Our findings indicate that creditors exert significant and far reaching influence over corporate payout policy decision-making, however, the importance of the agency costs of equity predominates.