The Dark Side of Private Benefits: Implications from Block Trades
This paper provides a new test of agency problem by examining the relationship between the size of private benefits of the new blockholder and the likelihood of future litigation using block premium as a measure of private benefits. In multivariate logit regressions with a variety of controlling factors, we find that the incidence of securities litigation and earnings management is positively related to higher block premium coupled with greater likelihood of CEO turnover at the time of the block trade. The results suggest that people with greater private benefits of control have greater likelihood of engaging in corporate misconduct.
block trades class action lawsuits earnings management
Jaiho Chung Joon Ho Hwang Joon-Seok Kim
Business School,Korea University,Anam-dong,Seongbuk-Gu,Seoul 136-701,KOREA Korea Securities Research Institute,KSDA Building,45-2 Youido-dong,Youngdungpo-gu,Seoul 150-974,Kore
国际会议
大连
英文
1-40
2008-07-02（万方平台首次上网日期，不代表论文的发表时间）