Working Papers
No Need for Help: The Effect of CEO Incentives on Blockholder Ownership, with Garry Twite [updated on 2024-10-19]
Abstract: In this paper, we study the causal effect of CEO incentives on blockholder ownership of a firm. Using uninformative CEO stock sales as an instrument for the change in CEO incentives, we find that weaker CEO incentives attract blockholders to a firm. The effect is stronger on blockholders who actively monitor and on those who want to free-ride the active monitors. The effect is also stronger when the CEO is more likely to misbehave ex-ante. Taken together, our results support the substitution effect of incentive contracts on blockholder monitoring and help understand the determinant of blockholder ownership.
Presentation (selected): 2022 FMCG PhD Symposium; 2022 FMA European; 2022 EFA Doctoral Tutorial; 2022 FMA Special PhD Paper Presentation; Asia-Pacific Corporate Finance Online Workshop; 2022 FIRN PhD Symposium; 2022 Paris December Finance Meeting; 2022 AFBC.
Media Coverage: The FinReg Blog, by the Duke Financial Economics Center at Duke University.
Helpful Creditors, Opportunistic Blockholders, with Garry Twite [draft coming soon]
Presentation (selected): 2022 FMCG Conference; 2022 FMA Asia Pacific; 2023 AFBC.
Ownership Concentration and Crisis Recovery, with Yifan Zhou
Presentation (selected): 2023 AFBC.
Work in Progress
Politics and ESG Decisions, with Yuyang Zhang
Information Transmission and Short-Selling, with Bochen Wu