We quantify the pervasiveness of informed trading activity in target companies’ equity options before M&A announcements. About 25% of takeovers have positive abnormal volumes, which are greater for short-dated out-of-the-money calls, consistent with bullish directional trading ahead of the announcement. Over half of this abnormal activity cannot be explained by speculation, news and rumors, tra...

We consider an infinitely repeated oligopoly in which at each period firms not only serve the spot market by either competing in prices or quantities but also have the opportunity to trade forward contracts. Contrary to the pro-competitive results of finite-horizon models, we find that the possibility of forward trading allows firms to sustain collusive profits that otherwise would not be possi...

This paper studies the relation between the premiums in takeover bids involving exchange-listed target firms from 1975-91 and the pre-announcement stock price runups. The evidence shows that the pre-bid runup and the postannouncement increase in the target’s stock price (the Amarkup@) are generally uncorrelated. With little substitution between the runup and the markup, the runup is an added co...

Using the Dow Jones Industrial Average Index record breaking days as a proxy for market wide attention, we show that as the aggregate stock market intensifies investor attention, stock market response to individual firms’ earnings announcements significantly increases. We hypothesize that there are many channels for the attention spill-over effect and document strong supportive evidence of one ...

In this paper we study worldwide antidumping (AD) case filing patterns in order to determine the extent to which economic versus strategic incentives explain the behavior of countries employing AD actions. We compare four main hypotheses. Two are motivated by the BagwellStaiger (1990) model of special protection and are consistent with the view that AD actions are used to prevent unfair trade: ...

Article history: One of the crucial issues of Received 22 November 2007 Received in revised form 29 October 2008 Accepted 5 November 2008 Available online 19 November 2008

This paper demonstrates that “grandfathering” of pollution rights may be inefficient when existing polluters enjoy market power or when there are increasing returns to abatement efforts. On the other hand an “auction and refund” approach, by effectively charging producers for the pollution they cause and refunding them in proportion to the value of their economic output levels, will result in g...

This paper examines the effect of introducing insider tratlin~; restrictions on the behaviour of the Amsterdam Stock Exchange. From 198'7 on, insiders are no longer allowed to trade two months before an annual earnings announcement. The results indicate that stocks became less liquid (when liquidity is measured by trading volume) when insiders were not allowed to trade. We also find some eviden...