Author
Teng, Haimeng
Other Contributors
Wu, Qiang; Francis, Bill; Hasan, Iftekhar; Maharjan, Johan;
Date Issued
2019-08
Subject
Management
Degree
PhD;
Terms of Use
This electronic version is a licensed copy owned by Rensselaer Polytechnic Institute, Troy, NY. Copyright of original work retained by author.;
Abstract
In chapter one, I examine the effect of passive institutional holdings on firms’ earnings quality by exploiting the variation in passive ownership around Russell 1000/2000 index cutoff. Using four sets of earnings quality proxies (properties of earnings, investor responsiveness to earnings, external indicators of earnings misstatements, and real earnings management), I find that passive ownership improves earnings quality. Furthermore, this effect is more pronounced in firms with lower active institutional ownership. Finally, I find firms with higher passive ownership undertake more long-term investments. My finding that higher passive ownership improves earnings quality in their portfolio companies suggests that passive investors play an important role in corporate governance.; Chapter two investigates the gender effect on asymmetric cost behavior. I find robust evidence that firms with female CEOs exhibit less cost asymmetry than firms with male CEOs. Cross-sectional tests show that this gender effect is concentrated in the economic downturn period, firms with higher business risk, and CEOs with higher personal career concerns, corroborating that females’ risk-aversion is the underlying mechanism through which female CEOs affect asymmetric cost.; In chapter three, I find that foreign institutional investors (FIIs) are negatively associated with their investee firms’ tax avoidance. I provide evidence that the effect is driven by the costs associated with institutional distance between FIIs’ home countries and host countries. Specifically, I find that the negative effect is driven by the influence of FIIs from countries with high-quality formal institutions (i.e., high-shareholder-protection, high-government-effectiveness, and high-regulatory-quality) / high-quality informal institutions (i.e., high-tax-morality, low-corruption, and high-religiosity) on investee firms located in countries with low-quality formal institutions/low-quality informal institutions. Finally, I show that the effect is also concentrated on FIIs with stronger monitoring incentives.; This dissertation consists of three distinct but related essays examining how diversity of investors (e.g., passive investors and foreign institutional investors) and managers (e.g., CEOs) affects firms’ accounting decision-making.;
Description
August 2019; School of Management
Department
Lally School of Management;
Publisher
Rensselaer Polytechnic Institute, Troy, NY
Relationships
Rensselaer Theses and Dissertations Online Collection;
Access
Restricted to current Rensselaer faculty, staff and students. Access inquiries may be directed to the Rensselaer Libraries.;