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I use a vector autoregressive model ~VAR! to decompose an individual firm's stock return into two components: changes in cash-f low expectations ~i.e., cash-f low news! and changes in discount rates ~i.e., expected-return news!. The VAR yields three main results. First, firm-level stock returns are mainly driven by cash-f low news. For a typical stock, the(More)
We investigate whether individual experiences of macroeconomic shocks affect financial risk taking, as often suggested for the generation that experienced the Great Depression. Using data from the Survey of Consumer Finances from 1960-2007, we find that individuals who have experienced low stock-market returns throughout their lives so far report lower(More)
and seminar participants at Chicago GSB, Harvard Business School, and the NBER Asset Pricing meeting for helpful comments. We are grateful to Ken French for providing us with some of the data used in this study. All errors and omissions remain our responsibility. Campbell acknowledges the financial support of the National Science Foundation. Abstract This(More)
  • Malcolm Baker, Jeffrey Wurgler, +12 authors David Scharfstein
  • 2002
We develop a theory in which the decision to pay dividends is driven by investor demand. Managers cater to investors by paying dividends when investors put a stock price premium on payers and not paying when investors prefer nonpayers. To test this prediction, we construct four time series measures of the investor demand for dividend payers. By each(More)
Combining data on brokerage commissions that mutual fund families paid for trade execution between 1996 and 1999 with data on mutual fund holdings of initial public offerings (IPOs), I document a robust, positive correlation between commissions paid to lead underwriters and reported holdings of the IPOs they underwrite. Moreover , I find that the(More)
We investigate directly whether analyst behavior influenced the likelihood of banks winning underwriting mandates for a sample of 16,625 U.S. debt and equity offerings sold between December 1993 and June 2002. We control for the strength of the issuer's investment-banking relationships with potential competitors for the mandate, prior lending relationships,(More)
BACKGROUND The decision to undergo mitral valve surgery is often made on the basis of echocardiographic criteria and clinical assessment. Recent changes in treatment guidelines recommending surgery in asymptomatic patients make the accurate assessment of mitral regurgitation (MR) severity even more important. OBJECTIVES The purpose of this study was to(More)
BACKGROUND The obesity paradox has been reported in several populations of patients with cardiovascular disease. Recent data have shown that physical fitness may attenuate the obesity paradox. Patients who undergo pharmacologic stress testing are known to have a higher risk of mortality than those who can exercise. The purpose of this study is to determine(More)