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Why Do Countries Matter So Much In Corporate Social Performance?, Ye Cai, Carrie Pan, Meir Statman
Why Do Countries Matter So Much In Corporate Social Performance?, Ye Cai, Carrie Pan, Meir Statman
Finance
Why do levels of corporate social performance (CSP) differ so much across countries? We answer this question in an examination of CSP ratings of more than 2,600 companies from 36 countries. We find that firm characteristics explain very little of the variations in CSP ratings. In contrast, variations in country factors such as stages of economic development, culture, and institutions account for a significant proportion of variations in CSP ratings across countries. In particular, we find that CSP ratings are high in countries with high income-per-capita, strong civil liberties and political rights, and cultures oriented toward harmony and autonomy. Furthermore, …
The Bid-Ask Spread In The Danish Stock Market: Evidence From The 1990s, Torben Voetmann
The Bid-Ask Spread In The Danish Stock Market: Evidence From The 1990s, Torben Voetmann
Finance
This paper investigates the cost components of bid-ask spreads around earnings announcements on the small Danish stock market in the 1990s. The results indicate that negative earnings surprises convey pricing information, suggesting the existence of significant information asymmetry between market makers and informed traders. Negative earnings surprises resulted in an increase in adverse-selection cost and trading volume while inventory-holding and order-processing costs decreased, leading to a combined decrease in the realized spread. The change in the realized spread is significant, while the change in the quoted bid-ask spread is negligible. Overall, the results suggest that informed traders’ ability to assess …