Business Commons^™

Are Markets Rational? Investors’ Response To Persistent Bias In Analysts’ Earnings Forecasts, Seung-Woog Kwag

Doctoral Dissertations

This dissertation intends to address the following two issues: 1) Persistence of the bias in analysts' earnings forecasts; 2) Investors’ response to such bias. It extends the understanding of information economics in earnings studies, and is expected to improve asset pricing models, suggest better model specifications for earnings studies, provide regulatory policy implications, and facilitate discussions on investor rationality.

Using two look-back portfolio formation methods that capture salient features of analysts' past forecasting behavior, I form quintile portfolios that describe the range of analysts' forecasting behavior. The optimistic portfolios refer to the portfolios containing firm-quarters whose contemporaneous forecast errors are …

Cultural Value Orientations As An Antecedent To The Formation Of International Interfirm Relationships: The Developmentof Cultural Value Dimensions In A Business Context, Susan Forquer Gupta

Doctoral Dissertations

With the importance of international interfirm relationships increasing, it becomes critical to understand the antecedents and consequences of relationship formation. Difficulty in relationships occur when firms with differing cultural value orientations attempt to engage in exchange. Culture affects the international firm in several ways: 1) difficulty in establishing a single organizational culture when a firm is comprised of multi-national employees; 2) difficulty in serving the market when cultural differences exist in the consumer; and 3) difficulty in establishing interfirm relationships across cultural boundaries. Individually, these problems are difficult to resolve, combined they can lead to failure. The first two have …

The Firm's Decision To Issue Debt Privately: Motivations And Costs, David William Blackwell

Doctoral Dissertations

This dissertation examines the issue cost of public utility debt sold publicly and privately from June 1979 to December 1983 and determines: (1) whether private and public debt have the same issue cost for firms who substitute between private placements and public sales (switch hitters), ceteris paribus; (2) whether issue cost differences between public issues and private placements by switch hitters vary with the degree of market uncertainty; (3) whether firms who do not substitute between private placements and public sales (non-switch hitters) choose to issue debt privately because the agency costs of debt can be resolved less expensively in …

Essays On Investment And Financing Decisions, George P. Tsetsekos

Doctoral Dissertations

This dissertation contains three essays in the area of Business Finance which are related to the literature of asymmetric information and agency. Our purpose is to demonstrate that the presence of asymmetric information creates possible costly effects that adversely influence the performance and profitability of the firm.

The first essay deals with the value of slack (excess liquidity) and the investment decision under asymmetric information. It is shown that when managers and shareholders hold different information sets with respect to the quality of an investment opportunity, an optimum amount of slack can partially resolve an underinvestment problem. The employed framework …