Finance and Financial Management Commons^™

Benefits Of Lending Relationships In Public Debt Markets: Empirical Evidence From The Commercial Paper Market, David W. Blackwell, Vladimir Kotomin, Drew B. Winters

Faculty Publications – Finance, Insurance, and Law

There is a large body of literature on the benefits of established lending relationships with banks, which is an intermediated debt market. We extend the literature by testing for benefits from direct lending relationships in the commercial paper market, which is a public debt market. Diamond (1991) suggests that firms access public debt markets when they have enough reputation to no longer require the close monitoring by banks. Using daily rate data for dealer-placed and directly placed commercial paper, we find that the year-end liquidity squeeze is less pronounced in the directly placed commercial paper than in the dealer-placed commercial …

Modeling Risk Management In Banks: Examining Why Banks Fail, Daniel O. Okehi

2010-2016 Archived Posters

The aim of this research was to determine why there have been persistent bank failures in Nigeria and to investigate whether ineffective risk management in banks, coupled with poor corporate governance practices and nonadherence to regulations (independent variables), play a significant role in the banks' performance(dependent variable).

A Cross-Regional Comparison Of Fabricated Metals' Manufacturing Sector Resiliency, Linda Ann Holt

Walden Dissertations and Doctoral Studies

Fabricated metals' manufacturing sector employment in the United States declined following the onset of the 2008 recession. Premium compensation and benefits afforded to employees within the manufacturing sector amplified the negative effects of recessionary job losses. Using the regional macroeconomic complex adaptive systems (CAS) framework, the purpose of this study was to examine the geographic distribution of job losses, recovery rates, and adaptive behavior after the recession for the fabricated metals manufacturing sector by measuring and comparing effects in 50 East North Central division MSAs and 50 South Atlantic division MSAs in the United States. Independent sample t tests compared …

Differences In Financial Performance And Risk Tolerance At Faith-Based Credit Unions, Bruce J. Toews

Walden Dissertations and Doctoral Studies

In the United States, faith-based and other small credit unions are vanishing at the rate of nearly a credit union each workday. The purpose of this causal-comparative study was to provide managers of faith-based credit unions with information about differences in financial performance and risk tolerance between faith-based and non-faith-based credit unions in order to improve their investment strategy and long-term sustainability. The study included a comparison of ratios measuring the financial performance and risk tolerance of randomly selected faith-based credit unions in the United States with the corresponding ratios of non-faith-based credit unions of similar size and location from …

College Retention Connections With Multiple Influencing Factors, Jamie Esther Mccracken

Walden Dissertations and Doctoral Studies

There are many challenges associated with student retention. Saint Mary-of-the-Woods College (SMWC) has focused on determining the factors affecting student retention across its campus and distance course delivery formats in order to improve student retention. The purpose in this study was to explore the extent to which age, course delivery, technical ability, and financial background determine retention at SMWC. Retention and attrition models of Tinto and Walleri laid the foundation of this study. Qualitative data on technical ability were collected from 69 students who responded to the survey instrument on Survey Monkey. Quantitative data on retention, age, course delivery, and …

Performance Implications Of Fortune 500 Companies' Self-Interest In Corporate Social Responsibility Activities, Peter M. Neeves

Walden Dissertations and Doctoral Studies

Numerous prior studies examining the relationship between Corporate Social Responsibility (CSR) and corporate financial performance have produced mixed results. Consumers expect alignment between corporation's CSR and business activities, yet a paucity of research examines the nature of CSR activities as related to corporate financial performance. Corporate leaders lack direction as to what CSR activities are most impactful. CSR is grounded in stakeholder theory, ethical work climate, and servant leadership theories. The relationship between self-interest in CSR activities, an index of alignment between business activities and CSR activities, and financial performance as measured by return on assets (ROA), return on equity …

Relationship Between Bootstrap Financing, Number Of Employees, And Small Business Success, Robin Marie Schofield

Walden Dissertations and Doctoral Studies

Small business entrepreneurs face high failure rates, yet the success of local, state, and national economies relies on the success of small business. With a lack of capital commonly cited as a reason for failure, entrepreneurs must find ways to predict business survival. Grounded in pecking order and enactment theory, the purpose of this correlational study was to examine the efficacy of bootstrap financing and numbers of employees in predicting business survival, measured by the business age. The research question was answered by using a predictive correlational quantitative research method with a cross-sectional survey design. The central question was whether …

Cyclical Economic Impacts On Aggregated Fiscal Imbalance Levels In The United States, Douglas Arthur Merriman

Walden Dissertations and Doctoral Studies

Cyclical Economic Impacts on Aggregated Fiscal Imbalance Levels in the United States

by

Douglas A. Merriman

MSM, University of Maryland University College, 2004

BS, Central Washington University, 1983

Dissertation Submitted in Partial Fulfillment

of the Requirements for the Degree of

Doctor of Philosophy

Applied Management and Decision Science

Walden University

July 2015

The impacts of cyclical economic volatility on state-level fiscal imbalance levels have gained attention, given that beginning in late 2007, the United States experienced the deepest and longest-lasting recession in its history. The problem addressed by this study was whether there was a statistically significant relationship between certain …

A Case Study Of Blue-Collar Worker Retirement Investment Decisions, Mark Eldridge Griffin

Walden Dissertations and Doctoral Studies

The finances of blue-collar workers were the most acutely impacted as these workers lost their jobs during the Great Recession of 2007 through 2009. The literature revealed a minimal understanding of how blue-collar workers allocated funds for their retirement, and what their investments might be when they invested. To address this problem, the current qualitative study addressed (a) how blue-collar workers chose to invest or not invest for retirement and (b) how blue-collar workers diversified their portfolio if they chose to invest. Theoretical foundations of the study were based on regret theory and prospect theory. A nonrandom purposeful sample of …

The Quixotic Quest For Fairness: The Sec's Role In The Rise Of High Frequency Trading, Jan Traflet, William R. Gruver

Faculty Journal Articles

This paper examines the complex factors facilitating the rise of high frequency trading (HFT) from a historical perspective. Over the course of several decades, various stock market regulations and reforms, championed by the Securities and Exchange Commission (SEC), created room for HFT to develop and flourish. While advancements in technology initially may appear to be the primary cause of HFT, in fact, HFT could not exist (or at least, not to the extent it does today) if certain rules and older ways of doing business on the exchanges were still in place, and if other regulations did not support its …

Corporate Risk-Taking And Public Duty, Steven L. Schwarcz

Faculty Scholarship

No abstract provided.

Next Focal Point Of China's Stock Market: Earnings-But Can We Trust The Numbers?, Shaomin Li, Seung Ho Park

Management Faculty Publications

[Introduction] The recent stock market turmoil and the economic slowdown in China have kept analysts busy projecting where the economy is going and what the government will do. The Chinese government has also issued a number of reforms of state-owned enterprises and other aspects of the economy. However, these reforms and increased scrutiny by both regulators and investors will be futile unless larger problems with market fundamentals in Chinese companies are addressed.

While the world's attention has been fixed on what the Chinese government is going to do next, there has been a tendency to neglect market fundamentals and to …

Suitable Financing: A High-Tech Semiconductor (Photonics) Start-Up Context, Sarkar Mahbub Akhter

Theses

This research investigates the financing options available to a "High-Tech Start-up" when a technical person seeks to start a business from innovations emerging from his or her daily work. In seeking to understand the different factors which might influence the choice of a particular type of financial source, firstly a thorough literature survey has been performed. In the main part of the study, a qualitative research approach was considered to be the most appropriate one and as part of it, a number of interviews with entrepreneurs, CEOs and CTOs have been conducted. Findings from these people with financial experiences are …

Investcorp, Jeremy Kappes, Haynes King, Jamie Mattioli, Prasad Vaze, Timothy Kyle Benusa, Sam Gottwald, Thomas Arnold, Jeffrey S. Harrison

Robins Case Network

Investcorp is a publicly traded global alternative asset management company headquartered in Manama, Bahrain. It manages a huge hedge fund, along with other assets. The case describes Investcorp’s history, investment strategies, and major competitors. The company has a highly aggressive growth strategy, but it is also facing the retirement of its CEO.

Salesforce.Com, Sean Bielawski, Charles Kempe, Austin Mcdaniel, Adam Tate, Jeffrey S. Harrison

Robins Case Network

Innovation! One of the most innovative companies, and also one of the best companies to work for, is losing money. This case traces the meteoric rise of the number one customer relationship management service provider against huge rivals such as Microsoft and Oracle. Detail regarding their highly innovative Scrum system is provided, along with detail regarding their marketing approach. How can Salesforce.com regain profitability while continuing to grow in a highly competitive industry?

10b5-1 Plans And Earnings Management By High-Level Executives, Joshua A. Thomas

CMC Senior Theses

Using historical firm financial and insider trading information, this paper examines whether high-level insiders manipulate earnings ahead of their own 10b5-1 equity transactions. The empirical evidence suggests that high-level executives appear to manipulate earnings through real activities such as abnormal discretionary expenditures and abnormal cash flows from operations to influence equity prices ahead of their own transactions under Rule 10b5-1. Evidence also suggests that executives appear to be unlikely to engage in earnings management through highly scrutinized means such as accruals. An interpretation of these results is that high-level executives may be using 10b5-1 plans as an offensive tool to …

Experiential Learning In Personal Finance: A Principles And Applications Based Approach, James C. Brau, Jacob K. Nielson, Bryan L. Sudweeks

Faculty Publications

This paper discusses the need for increased financial literacy among college-aged students and then presents and analyzes a personal finance class taught at a large, private university. The course is designed around five characteristics which, when combined, result in a high value-added pedagogy. These characteristics are the following: a humanistic approach to personal finance, a principles-based approach, an applications-based curriculum, a partnership with Intuit's Quicken, and a serviceteaching requirement. With a track record of over a dozen years and 3,128 students, the course continues to be one of the best-rated courses among both students and alumni.

Curtain Call Executive Services, Steven D. Dolvin

Scholarship and Professional Work - Business

This case would be considered a critical incident, as it focuses on one primary issue – the valuation of a private equity investment in the underlying business. I have constructed the case based on consulting work I completed for the actual company, as they needed a valuation model for accounting purposes. So, all data, including the legal characteristics, are obtained directly from the company. However, for confidentiality reasons, the name of the firm has been changed.

This case itself concerns the valuation of an investment by a private equity firm in a mid-market business. The student must evaluate and understand …

Spend Now Or Spend Later: The Role Of A Business Education And Critical Thinking Skills In Increasing Retirement Plan Saving Rates For New, Young Enrollees, Priscilla Arling, Jill Kirby, Kegan Saajasto

Scholarship and Professional Work - Business

For college graduates entering the workforce, contributing to an employer-sponsored 401(k) retirement plan can be an important way of saving for the future. However, contribution rates for young people in these plans are far below recommended percentages, leading to concerns about future financial stability for these individuals. Prior work has shown that a college student’s major and academic coursework affect their general financial knowledge. However, little is known about what content within a course of study correlates with specific financial decisions. The decision of how much to save in a 401(k) plan is complex and requires thinking beyond a present-day …

Profitable Momentum Trading Strategies For Individual Investors, Bryan Foltice, Thomas Langer

Scholarship and Professional Work - Business

For nearly three decades, scientific studies have explored momentum investing strategies and observed stable excess returns in various financial markets. However, the trading strategies typically analyzed in such research are not accessible to individual investors due to short selling constraints, nor are they profitable due to high trading costs. Incorporating these constraints, we explore a simplified momentum trading strategy that only exploits excess returns from topside momentum for a small number of individual stocks. Building on US data from the New York Stock Exchange from July 1991 to December 2010, we analyze whether such a simplified momentum strategy outperforms the …

Ranking Small Business Resistance Criteria Toward The Affordable Care Act, Rakesh M K Gupta

Walden Dissertations and Doctoral Studies

Following the enactment of the Affordable Care Act (ACA) in 2010, politicians, media, and lobbyists rendered a number of conflicting and confusing interpretations of its merits and demerits. Such interpretations intensified the skepticism and concerns of small business enterprise (SBE) owners. The purpose of this study was to develop a representative, prioritized list of SBE owners' concerns or resistance factors. The goal was to create a useful guide for SBE owners who are seeking ways to reducing the adverse financial impact of the law. With social choice theory as the theoretical framework, 50 randomly selected SBE owners across 5 distinct …

Pagtugon Sa Sari-Saring Panganib: Mga Aral Mula Sa Mga Krisis Pananalapi, Tereso S. Tullao Jr

Angelo King Institute for Economic and Business Studies (AKI)

Nitong nakaraang dalawang dekada, nakaranas ang mga ekonomiya sa iba’t ibang bahagi ng mundo ng tatlong matitinding krisis pananalapi. Ang mga ito ay nagdulot ng malalawak na pinsala sa mga mamamayan, pamahalaan at mahahalagang sektor ng ekonomiya lalo na sa sektor ng pananalapi.

Ang pagkalat ng krisis pananalapi tungo sa isang malawakang krisis ekonomiko ay nakasalalay sa sektor ng pananalapi lalo na ang pagbabangko. Makikita na maraming sa mga sanhi ng krisis ay nakaugat sa di maingat ng pagbabangko. May mga pagkakataon din na ang krisis ay hindi nagmumula sa mga bangko. Ngunit dahil ang mga bangko ay pangunahing sektor …

Territorial Tax System Reform And Corporate Financial Policies, Matteo P. Arena, George Kutner

Finance Faculty Research and Publications

We examine the effect of a permanent change to a country corporate income repatriation tax system on corporate financial policies. In 2009, Japan and the United Kingdom switched from a worldwide system to a territorial system for the taxation of repatriated foreign earnings, effectively reducing the tax liabilities of most multinational firms when repatriating earnings. We find that after the change firms accumulate less cash, pay out larger amounts through dividends and share repurchases, and invest less abroad. We do not find that the tax system change has significantly affected domestic investments even when controlling for capital constraints.

Political Risk And The Cost Of Capital In Asia-Pacific Property Markets, George D. Cashman, David M. Harrison, Hainan Sheng

Finance Faculty Research and Publications

This study investigates the impact of political risk on the cost of capital for publicly traded real estate firms. More specifically, by using a sample of 102 REITs and listed property trusts, which hold nearly 6,000 distinct investment properties across the Asia-Pacific region, we find strong empirical evidence that increased exposure to political risk increases both the cost of equity financing of a firm and its weighted average cost of capital. Interestingly, no such linkages are apparent between political risk and the cost of debt of a firm. These empirical results are robust to a variety of alternative measures of …

Economic Conundrums In Search Of A Solution: The Functions Of Third-Party Litigation Finance, Joanna M. Shepherd, Judd E. Stone Ii

Faculty Articles

Despite a rapid increase in economic significance and substantial increase in international use, third-party litigation financing remains poorly understood. No academic consensus takes account of the multiple economic conundrums that third-party litigation financing arises to solve, nor do legal scholars adequately consider obvious public and private substitutes for litigation financing that society rightfully recognizes as innocuous or outright beneficial. In this Article, we explore the economic challenges driving both business plaintiffs and sophisticated law firms to seek external litigation financing. We examine closely the key elements of the litigation financing arrangement itself, focusing on eligible cases and clients, devices financiers …

Waiting For The Confidence Fairy: An Analysis Of European Sovereign Bond Spreads Before And After The Financial Crisis, David Uresti

Open Access Theses & Dissertations

The 2008 Financial Crisis that began in the United States caused widespread panic throughout the financial sector which resulted in the collapse of some companies and large losses for others. The availability of credit declined even as investor confidence continued to deteriorate. The European periphery concluded that the Financial Crisis would be relegated to the American economy. However, in 2009 Greece suffered a credit downgrade that signaled that the financial shock entered European shores. Shortly thereafter Spain suffered a credit downgrade followed by Italy in 2010. Suddenly the threat of default by a number of European countries became very real. …

Performance Of Utility Based Hedges, Jim Hanly, John Cotter

Articles

Hedgers as investors are concerned with both risk and return. However when measuring hedging performance, the role of returns and investor risk aversion has generally been neglected in the literature, by its focus on minimum variance hedging. In this paper we address this by using utility based performance metrics to evaluate the hedging effectiveness of utility based hedges for hedgers with both moderate and high risk aversion together with the more traditional minimum variance approach. To examine this for an energy hedger, we apply our approach to WTI Crude Oil, for three different hedging horizons, daily, weekly and monthly. We …

Three Essays On Compensation And The Board Of Directors, Ian Cherry

Electronic Theses and Dissertations

In my first essay, I find a statistically and economically significant director-specific component in CEO pay following the enactment of the Sarbanes-Oxley Act of 2002 (SOX). In the cross-section of firms, directors that award relatively higher (lower) CEO pay in one firm also award relatively higher (lower) CEO pay in other firms of whose boards they are members during the year. Based on my estimates, the director-specific component is responsible for around ±3.5% of total CEO pay or around ±$230,000 per CEO-year on average. In addition to affecting CEO pay levels, the director-specific component also has a significant effect on …

Strategically Camouflaged Corporate Governance In Ipos: Entrepreneurial Masking And Impression Management, David F. Benson, James C. Brau, James Cicon, Stephen P. Ferris

Faculty Publications

Entrepreneurs attempt to persuade potential investors that their new ventures are both credible andworthy of funding. A long line of research on entrepreneurial impressionmanagement establishes that the ability to present their ventures in a favorable light is a key attribute of successful entrepreneurs. In this study, we examine the opposite side of the issue and test to determine if some entrepreneurs obscure corporate governance information.We create a newmetric tomeasure the level of camouflage used in governance documents for initial public offerings (IPOs). We find that entrepreneurs are less likely to use camouflage during periods of high scrutiny, as measured by …

Why Cash Flow Is More Important Than Profit, Aretha Boex

White Papers

While profits are good, they do not adequately represent the financial standing of a firm. It is quite possible for a company to report profits but be unable to grow, secure financing or attract investors.