Digests

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...

Meng Han, Lammertjan Dam, Walter Pohl
Review of Finance, Volume 29, Issue 2, March 2025, Pages 315–347, https://doi.org/10.1093/rof/rfae043

In financial markets, price variation generally reflects variation in discount rates rather than in expected cash flows, a pattern observed in many asset markets. … Read more...

Rebel A Cole, Jason Damm, John Hackney, Masim Suleymanov
Review of Finance, Volume 29, Issue 1, January 2025, Pages 275–313, https://doi.org/10.1093/rof/rfae037

In the U.S., state-level exemption laws determine the amount of property that individuals can protect from creditor liquidation during the debt settlement process of bankruptcy proceedings.… Read more...

Amit Goyal, Narasimhan Jegadeesh, Avanidhar Subrahmanyam
Review of Finance, Volume 29, Issue 1, January 2025, Pages 241–273, https://doi.org/10.1093/rof/rfae038

Ever since the publication of Jegadeesh and Titman (1993), the profession has been puzzling over the causes of stock return momentum (the tendency for the relative performance of stocks over the past 3-12 months to repeat itself).… Read more...

Agostino Capponi, Albert J. Menkveld, Hongzhong Zhang
Review of Finance, Volume 29, Issue 1, January 2025, Pages 201–239, https://doi.org/10.1093/rof/rfae036

Institutional investors have become so large in many markets that their orders experience substantial price impact.  In response, they started to algorithmically shred the order into smaller pieces that are sent to the market over a particular time interval. … Read more...

Andreas Johansson, Riccardo Sabbatucci, Andrea Tamoni
Review of Finance, Volume 29, Issue 1, January 2025, Pages 103–139, https://doi.org/10.1093/rof/rfae034

We construct tradable risk factors for institutional and retail investors by combining large, liquid mutual funds for the long leg and ETFs for both long and short legs.… Read more...

Tomas Breach, Thomas B King
Review of Finance, Volume 29, Issue 1, January 2025, Pages 33–73, https://doi.org/10.1093/rof/rfae033

Short-term borrowing arrangements collateralized by financial assets—collectively referred to as “securities financing” transactions—are key mechanisms through which investors obtain leverage and engage in arbitrage. … Read more...