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Conference Paper: Does short selling discipline managerial empire building?

TitleDoes short selling discipline managerial empire building?
Authors
KeywordsShort selling
Empire building
Governance
Mergers and acquisitions
Regulation SHO
Issue Date2014
PublisherFinancial Management Association International.
Citation
The 2014 FMA Asian Conference, Tokyo, Japan, 8-10 May 2014. How to Cite?
AbstractThis paper explores the discipline effect of short selling on managerial empire building. Employing short-selling data from 2002-2011, we document a negative association between the stock lending supply and the subsequent abnormal capital investment. We also find a positive association between the lending supply and the mergers and acquisitions announcement returns of acquiring firms. Firms with higher lending supplies also have higher Tobin’s Q in the subsequent year. In addition, the discipline effect is stronger for firms with higher managers’ wealth-performance sensitivity and with lower financial constraints, and for stock-financing acquisition deals. Alleviating the endogeneity concern, our multivariate difference-in-difference analysis shows that the lending supply is a more effective discipline force for firms that are in the Regulation SHO-Pilot Program during 2005 to 2007.
DescriptionSession 20 - Monitors and Governance Quality
The Conference program's website is located at http://www.fma.org/Tokyo/TokyoProgramPrelim.htm
Persistent Identifierhttp://hdl.handle.net/10722/201628

 

DC FieldValueLanguage
dc.contributor.authorChang, ECen_US
dc.contributor.authorLin, TCen_US
dc.contributor.authorMa, Xen_US
dc.date.accessioned2014-08-21T07:33:11Z-
dc.date.available2014-08-21T07:33:11Z-
dc.date.issued2014en_US
dc.identifier.citationThe 2014 FMA Asian Conference, Tokyo, Japan, 8-10 May 2014.en_US
dc.identifier.urihttp://hdl.handle.net/10722/201628-
dc.descriptionSession 20 - Monitors and Governance Quality-
dc.descriptionThe Conference program's website is located at http://www.fma.org/Tokyo/TokyoProgramPrelim.htm-
dc.description.abstractThis paper explores the discipline effect of short selling on managerial empire building. Employing short-selling data from 2002-2011, we document a negative association between the stock lending supply and the subsequent abnormal capital investment. We also find a positive association between the lending supply and the mergers and acquisitions announcement returns of acquiring firms. Firms with higher lending supplies also have higher Tobin’s Q in the subsequent year. In addition, the discipline effect is stronger for firms with higher managers’ wealth-performance sensitivity and with lower financial constraints, and for stock-financing acquisition deals. Alleviating the endogeneity concern, our multivariate difference-in-difference analysis shows that the lending supply is a more effective discipline force for firms that are in the Regulation SHO-Pilot Program during 2005 to 2007.-
dc.languageengen_US
dc.publisherFinancial Management Association International.-
dc.relation.ispartofFMA Asian Conference 2014en_US
dc.rightsCreative Commons: Attribution 3.0 Hong Kong License-
dc.subjectShort selling-
dc.subjectEmpire building-
dc.subjectGovernance-
dc.subjectMergers and acquisitions-
dc.subjectRegulation SHO-
dc.titleDoes short selling discipline managerial empire building?en_US
dc.typeConference_Paperen_US
dc.identifier.emailChang, EC: ecchang@hku.hken_US
dc.identifier.emailLin, TC: chunlin@hku.hken_US
dc.identifier.emailMa, X: xrma@business.hku.hken_US
dc.identifier.authorityChang, EC=rp01050en_US
dc.identifier.authorityLin, TC=rp01077en_US
dc.description.naturepostprint-
dc.identifier.hkuros235014en_US

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