Tax Law (Books and Journals)

• María del Carmen Cámara Barroso

• Eduardo Berché Moreno

• Rafael J. Sanz Gómez

• Juan Franch Fluxà

• European Financial Management

We forecast portfolio risk for managing dynamic tail risk protection strategies, based on extreme value theory, expectile regression, copula‐GARCH and dynamic generalized autoregressive score models. Utilizing a loss function that overcomes the lack of elicitability for expected shortfall, we propose a novel expected shortfall (and value‐at‐risk) forecast combination approach, which dominates...

• European Financial Management

This paper demonstrates that trust directly influences contracting efficiency. We document that trust reduces demand for contract regulation and positively relates to a high‐quality contracting environment, supporting a substitution hypothesis. Furthermore, contract regulation no longer leads to poor contracting outcomes. These findings suggest that lack of trust significantly explains...

• European Financial Management

We analyze the distributional properties of ownership concentration measures and find that measures come from different underlying statistical distributions. Consistent with theory, some measures that are classified to represent a monitoring dimension have a positive influence on firm performance; other measures that are interpreted to represent a shareholder conflict dimension are negatively...

• European Financial Management

This paper studies the mechanisms which motivate managers to engage in cheap talk and attract the market's attention in a credible way. We consider stock split announcements, voluntary earnings forecasts, and press releases issued by firms to the media as proxies for managerial cheap talk. We show that: (a) managerial performance‐related pay contracts incentivize executives to attract attention; (

• European Financial Management

We test the existence of possible gender biases affecting firm behavior in demanding and obtaining bank credit using a cross‐country sample of European small‐ and medium‐sized enterprises (SMEs). We show consistent evidence that female‐led firms are more likely than their male counterparts to refrain from applying for loans. When they apply, female‐led enterprises do not seem to face gender...

• European Financial Management

• European Financial Management

This article addresses the investment and financing decisions of entrepreneurs entering into option‐for‐guarantee swaps (OGSs). OGSs increase investment option value significantly. Entrepreneurs initially accelerate their investments and then postpone them as funding gaps grow. Guarantee costs increase with project risks when the funding gap is sufficiently small or large, but the opposite holds...

• European Financial Management

This paper offers two new explanations for banks' home bias in government bond holdings: a sovereign‐based rating cap on corporates and the existence of a ‘bank tax.’ These are complementary to the four explanations offered in the literature: risk‐shifting, gambling for resurrection, moral suasion, and a means to store liquidity for financing future investment. Collectively, they cast doubt on...

• European Financial Management

Recent studies have shown the time trends of firm stock repurchase behavior. We examine these time changes for stock repurchase through the lens of real activities earnings management. Managers appear more likely to manipulate earnings through stock repurchases since the passage of the Sarbanes–Oxley Act (SOX) in 2002. Furthermore, suspect firms that just missed analyst earnings per share...

• European Financial Management

I examine the influence of large and small institutional investors on different components of chief executive officer (CEO) compensation, using US data for 2006–2015. An increase in large institutional ownership reduces total pay and current incentive compensation (i.e., options, stocks, bonus pay), whereas small institutional investors lower long‐term incentive pay (i.e., pension, deferred pay,...

• European Financial Management

In 2009, the Securities Exchange Board of India allowed qualified institutional investors to anchor initial public offerings (IPOs) by participating in the issue at a price and allocation publicly disclosed preceding the issue. We study anchor investors (AIs) in Indian IPOs during 2009–2017. We find the share allotment and the number of AIs separately have significant impacts on valuation and...

• Academic Journal of Business, Administration, Law and Social Sciences

The financial system in Kosovo since the post-war period and until the present has consistently increased in most of its values, which shows that financial institutions in Kosovo have established sound operation foundations by providing security and trust to clients. Banks are the only institution for injecting money into the economy. They are the key indicator in establishment of working places,

• European Financial Management

Employing a sample of 2,957 operational‐risk events across 31 countries from 1990 to 2011, we find that financial institutions located in countries with higher individualism tend to have higher operational risk. This positive relation is achieved through the risk‐taking channel and the earnings‐management channel. In addition, the magnitude of operational losses is higher in more individualistic...

• European Financial Management

This paper investigates the tone newspapers use in reporting information on a company that it is linked with through an ownership tie. Our empirical setting is Italy, a country characterized by dominant national industrial groups’ high ownership of newspapers. Based on a sample of about 123,000 articles, we document that newspapers’ coverage of firms in conflict of interest is greater, with...

• European Financial Management

Recent theoretical work suggests that debt collection agencies play an important role in gathering and processing debtor information. We study a comprehensive data set with information provided by original creditors and information gathered in third‐party debt collection. In line with the theoretical results, the initial information is sparse and the gathered information is essential for better‐in

• European Financial Management

In this article, we evaluate the profitability and economic source of the predictive power of the idiosyncratic momentum effect, by using five popular asset pricing models to construct the idiosyncratic momentum. We show that all five idiosyncratic momentum strategies produce similar return predictability and consistently outperform the conventional momentum strategy in the cross‐sectional...

• European Financial Management

Commercial banker‐directors (CBDs) bring both financial expertise in risk management and conflicts of interest between shareholders and debtholders. The burgeoning literature on stock price crash risk generates important questions of whether CBDs reduce crash risk. Using BoardEx data from 1999 to 2009, we find supporting evidence that the firms with CBDs experience lower stock price crash risk....

• European Financial Management

We link transitory deviations of consumption from its equilibrium relationship with aggregate wealth and labor income to equity returns on the one hand, and to two characteristics of bond investors—the premium demanded to hold long‐term assets, and “flight to quality” behavior—on the other hand. Using a panel of 10 euro area countries over the period 1984Q1–2017Q4, we show that a rise in the...

• European Financial Management

We relate credit risk and owners’ personal guarantees to bank loan maturities during the global financial crisis. The findings, which remain robust to reverse causality, show that firms rated as low risk, with a strong relationship with the bank, whose owners provided personal guarantees and with large loan sizes obtained longer maturities. Banks with larger nonperforming loans provided loans...

• European Financial Management

This study examines the link between information spread by social media bots and stock trading. Based on a large sample of tweets mentioning 55 companies in the FTSE 100 composites, we find significant relations between bot tweets and stock returns, volatility, and trading volume at both daily and intraday levels. These results are also confirmed by an event study of stock response following...

• European Financial Management

We examine how product market competition (PMC) shapes chief executive officer's (CEO) power. Using various measures to capture both PMC and CEO power, our analyses, which include a quasi‐natural experiment, find evidence that CEOs have less power when the product market is more competitive. Furthermore, the impact of PMC on CEO power is more pronounced for firms with entrenched management, lower

• European Financial Management

• European Financial Management

Does fund management skill allow managers to identify mispriced securities more accurately and thereby make better portfolio choices resulting in superior fund performance when noise trading – a natural setting to detect skill – is more prevalent? We find skilled fund managers with superior past performance to generate persistent excess risk‐adjusted returns and experience significant capital...

• European Financial Management

We investigate the cash holdings policy of family firms and examine potential value implications. Family firms hold more cash than other firms, with an average difference of 2.3% of total assets. This result is driven by firms managed by heir CEOs. While the cash holdings policy of first‐generation family firms is more sensitive to firm risk, consistent with founders’ increased risk aversion,...

• European Financial Management

This article analyzes the effect of computer breaches on publicly traded equities from 2005 to 2017. An event study is performed and breaches analyzed conditioned on whether the breach announcement has been made in the mainstream media or through other channels. We find that in the period prior to the announcement date in the media, the mean abnormal return is negative, reflecting a likely...

• European Financial Management

How does bankruptcy contagion propagate among industry peers? We study the debt recovery channel of industry contagion by examining whether the cost of a company's debt is affected by the observed recovery rates of its bankrupt industry peers. Our results show that lower industry recovery rates are associated with higher loan spreads, but only when the contracts were originated during industry...

• European Financial Management

We explore the impact of media content on sovereign credit risk. Our measure of media tone is extracted from the Thomson Reuters News Analytics database. As a proxy for sovereign credit risk we consider credit default swap (CDS) spreads, which are decomposed into their risk premium and default risk components. We find that media tone explains and predicts CDS returns and is a mixture of noise and

• European Financial Management

• European Financial Management

This study reexamines the relation between downside beta and equity returns in the United States. First, we replicate the 2006 work of Ang, Chen, and Xing who find a positive relation between downside beta and future equity returns for equal‐weighted portfolios of NYSE stocks. We show that this relation doesn't hold after using value‐weighted returns or controlling for various return determinants.

• European Financial Management

We find that motivated monitoring by institutional investors mitigates firm investment inefficiency, estimated by Richardson's (2006) approach. This relation is robust when using the annual reconstitution of the Russell indexes as exogenous shocks to institutional ownership during the period 1995–2015 and after classifying institutional ownership by institution type. We also show that closer...