| orporate governance deals with the ways in which suppliers of capital to firms improve their chances of getting a return on their investment (Shleifer and Vishny (1997)). In this dissertation, I analyze three aspects of governance that impact the incentives, policies, and decisions of the firm. In the first essay, Blockholder Attention, I recast the study of blockholder monitoring from a question of whether firms will listen to one that additionally asks are investors willing to talk. Given resource constraints, investors cannot talk to all of the firms they own and allocate their attention to those positions in which they have the most capital invested. Once I isolate blocks that receive the requisite attention, I find robust evidence of effective monitoring: firms with one of these High Attention Blocks experience significant improvements in compensation policies, turnover decisions, and acquisitions. Firms with blocks of relatively less importance do not enjoy any of these gains. In the second essay, CEO Skill in Corporate Acquisitions, I, along with my co-authors, Jeff Jaffe and Torben Voetmann, examine the incidence of differential skill in acquisition decisions. While we find significant evidence of persistent bidder returns when a firm retains the same CEO for consecutive acquisitions, it appears negative skill, or the repeated act of conducting value-destroying acquisitions, is the dominant trait. In the third essay, The Price Effects of Event-Risk Protection: The Results from a Natural Experiment, my co-authors, Karl Okamoto and Natalie Pedersen, and I use court rulings related to the... |
