Climate Change Concerns and Information Spillovers from Socially-connected Friends
Maximilian Mayer
IWH Discussion Papers,
Nr. 2,
2023
Abstract
This paper studies the role of social connections in shaping individuals’ concerns about climate change. I combine granular climate data, region-level social network data and survey responses for 24 European countries in order to document large information spillovers. Individuals become more concerned about climate change when their geographically distant friends living in sociallyconnected regions have experienced large increases in temperatures since 1990. Exploring the heterogeneity of the spillover effects, I uncover that the learning via social networks plays a central role. Further, results illustrate the important role of social values and economic preferences for understanding how information spillovers affect individual concerns.
Artikel Lesen
Alumni
IWH-Alumni Das IWH möchte den Kontakt zu seinen ehemaligen Mitarbeiterinnen und...
Zur Seite
Productivity, Managers’ Social Connections and the Financial Crisis
Iftekhar Hasan, Stefano Manfredonia
Journal of Banking and Finance,
August
2022
Abstract
This paper investigates whether managers’ personal connections help corporate productivity to recover after a negative economic shock. Leveraging the heterogeneity in the severity of the financial crisis across different sectors, the paper reports that (i) the financial crisis had a negative effect on within-firm productivity, (ii) the effect was long-lasting and persistent, supporting a productivity-hysteresis hypothesis, and (iii) managers’ personal connections allowed corporations to recover from this productivity slowdown. Among the possible mechanisms, we show that connected managers operating in affected sectors foster productivity recovery through higher input cost efficiency and better access to the credit market, as well as more efficient use of labour and capital.
Artikel Lesen
The Value of Firm Networks: A Natural Experiment on Board Connections
Ester Faia, Maximilian Mayer, Vincenzo Pezone
SAFE Working Papers,
Nr. 269,
2022
Abstract
We present causal evidence on the effect of boardroom networks on firm value and compensation policies. We exploit a ban on interlocking directorates of Italian financial and insurance companies as exogenous variation and show that firms that lose centrality in the network experience negative abnormal returns around the announcement date. The key driver of our results is the role of boardroom connections in reducing asymmetric information. The complementarities with the input-output and cross-ownership networks are consistent with this channel. Using hand-collected data, we also show that network centrality has a positive effect on directors’ compensation, providing evidence of rent sharing.
Artikel Lesen
Firm Social Networks, Trust, and Security Issuances
Ming Fang, Iftekhar Hasan, Zenu Sharma, An Yan
European Journal of Finance,
Nr. 4,
2022
Abstract
We observe that public firms are more likely to issue seasoned stocks rather than bonds when theirs boards are more socially-connected. These connected issuers experience better announcement-period stock returns and attract more institutional investors. This social-connection effect is stronger for firms with severe information asymmetry, higher risk of being undersubscribed, and more visible to investors. Our conjecture is this social-network effect is driven by trust in issuing firms. Given stocks are more sensitive to trust, these trusted firms are more likely to issue stocks than bonds. Trustworthiness plays an important role in firms’ security issuances in capital markets.
Artikel Lesen
Ostdeutschland
Die garstige Lücke Warum Ostdeutschland auch 30 Jahre nach der Vereinigung um 20% ärmer ist...
Zur Seite
Berufsausbildung
Berufsausbildung am IWH Am Leibniz-Institut für Wirtschaftsforschung Halle (IWH)...
Zur Seite
External Social Networks and Earnings Management
Ming Fang, Bill Francis, Iftekhar Hasan, Qiang Wu
British Accounting Review,
Nr. 2,
2022
Abstract
Using a sample of U.S. listed firms for the 2000–2017 period, we examine how external social networks of top executives and directors affect earnings management in their firms. We find that well-connected firms are more aggressive in managing earnings through both accruals and real activities and that the results are robust after controlling for internal executive social ties. Using a difference-in-differences approach, we find that earnings management decreases after a socially connected executive or director dies. Additional analysis shows that connections forged by past professional working experiences have a greater impact on earnings management than connections forged by education and other social activities. Moreover, CFO social networks have a greater influence on earnings management than CEO social networks. Finally, we explore the underlying mechanisms, finding that 1) firms that are socially connected to each other show more similarities in their earnings management than firms that do not share a connection, and 2) more connected firms are less likely to incur accounting restatements. Collectively, our findings indicate that the external social networks of top executives and directors are important determinants of both their accrual- and real activity-based earnings management.
Artikel Lesen
Evidenzbasierte Politikberatung (IWH-CEP)
Zentrum für evidenzbasierte Politikberatung (IWH-CEP) ...
Zur Seite
