...Bruno Lessa Meireles; Roy Martelanc; Aline Mariane de Faria; Eduardo Kazuo Kayo Purpose This study examines the market’s reaction to firms’ investment choices considering their opportunities, focusing on share price variations when firms overinvest without incentives or underinvest despite...

...Chris Harris; Zhe Li Purpose The purpose of this paper is to identify whether negative operating cash flows are related to investment inefficiency, and specifically whether they are related to subsequent overinvestment and if this relationship is driven by agency problems within the firm...

...Pi-Hsun Tseng; Xuan-Qi Su; Hsiu-Jung Tsai Purpose The purpose of this paper is to study the effect of managerial education levels on the wealth effect at the time of investment announcements, by testing two competitive hypotheses: the agency theory-based overinvestment hypothesis vs the Q-theory...

... Richardson’s (2006) method to measure firms’ pre-issue investment levels and then divide the SEO firms into the under-, normal-, and overinvesting groups. The study examines the relation between the pre-issue abnormal investment and long-run post-issue performance. In addition, the authors examine whether...