2025

Donald E Bowen and Jérôme P Taillard
Review of Finance, Volume 29, Issue 3, May 2025, Pages 747–777, https://doi.org/10.1093/rof/rfaf010

The 2002 NYSE/NASDAQ board independence mandates allow us to study how changes in board composition affect firm performance. The mandates required firms to have a majority of independent directors, with two paths to compliance: (1) replacing non-independent directors with independent directors or (2) “reclassifying” existing non-independent directors as independent once they met certain criteria (such as being three years removed from prior employment at the firm).… Read more...

Itzhak Ben-David, Mark J. Johnson, René M. Stulz
Review of Finance, Volume 29, Issue 3, May 2025, Pages 711–745, https://doi.org/10.1093/rof/rfaf009

The paper examines the resilience of data-driven lending during the unprecedented economic upheaval caused by the COVID-19 crisis, focusing specifically on small business fintech lending in March 2020.… Read more...

Sulkhan Chavleishvili, Manfred Kremer
Review of Finance, Volume 29, Issue 3, May 2025, Pages 685–710, https://doi.org/10.1093/rof/rfaf013

The Global Financial Crisis highlighted a critical asymmetry in macro-financial linkages, namely the fact that financial conditions have particularly strong effects on real economic activity in times of elevated financial distress.… Read more...

Ali Kakhbod, A Max Reppen, Tarik Umar, Hao Xing
Review of Finance, Volume 29, Issue 3, May 2025, Pages 661–683, https://doi.org/10.1093/rof/rfaf008

In this study, we ask a simple yet fundamental question: does a firm’s cash holdings always rise in tandem with its size?… Read more...

Sanghyun Hong, Xiaopeng Wei, Blockbuster or bust?
Review of Finance, Volume 29, Issue 2, March 2025, Pages 603–632, https://doi.org/10.1093/rof/rfaf004

Individuals in an enhanced mood tend to assess future prospects more optimistically, which subsequently fosters greater optimism in their investment decisions and drives stock market returns higher.… Read more...

Eliezer M Fich, Guosong Xu
Review of Finance, Volume 29, Issue 2, March 2025, Pages 567–602, https://doi.org/10.1093/rof/rfaf003

This paper studies whether exposure to salient climatic disasters affects institutional investors’ assessment of the environmental risks threatening their portfolio firms and, in turn, their support for environmental proposals.… Read more...

Antonio De Vito, Martin Jacob, Dirk Schindler, Guosong Xu
Review of Finance, Volume 29, Issue 2, March 2025, Pages 531–565, https://doi.org/10.1093/rof/rfaf006

This paper studies how corporate tax hikes transmit across countries through multinationals’ internal networks of subsidiaries. Prior theoretical models of tax competition suggest that the investment of a multinational in one country should increase if the business unit is exposed to a foreign corporate tax hike.… Read more...

Agnese Leonello, Caterina Mendicino, Ettore Panetti, Davide Porcellacchia
Review of Finance, Volume 29, Issue 2, March 2025, Pages 501–530, https://doi.org/10.1093/rof/rfae045

In recent years, banks have experienced unprecedented growth in deposits, particularly during the COVID-19 pandemic. In the U.S., total bank deposits as a percentage of GDP surged by around 15 percentage points in the first quarter of 2020, while the Euro Area saw an increase of approximately 20 percentage points.… Read more...

Marco Pagano and Luca Picariello
Review of Finance, Volume 29, Issue 2, March 2025, Pages 349–379, https://doi.org/10.1093/rof/rfae042

This paper explores the impact of corporate governance standards on firms’ hiring and promotion policies, focusing on meritocracy versus power retention by entrepreneurs. Effective corporate governance can influence firms to adopt meritocratic practices, promoting skilled employees based on merit rather than favoritism.… Read more...