Institut für Finanzwirtschaft, Banken und Versicherungen
– Abteilung Finanzwirtschaft und Banken –
Prof. Dr. Martin E. Ruckes
Master-Seminar Unternehmensfinanzierung im WiSe 2015/16
Corporate Governance:
Theory and Empirics
This seminar provides an overview of recent theoretical models of corporate
governance. It consists of three parts which deal with theories of i) the board of
directors, ii) blockholder monitoring, iii) CEO turnover. Each student will be
assigned one theoretical paper (see below). Students have to analyze their
theoretical paper and find appropriate empirical evidence. The research design
of the empirical studies has to be presented (i.e., explain how the theory is/can
be tested empirically). Students may further develop their own ideas for a
research design to test the theory presented in their paper.
Part 1: Boards of directors
1. Endogenously chosen board structures (Hoang)
Hermalin, B.E. and M.S. Weisbach, 1998. Endogenously Chosen Boards of Directors and
Their Monitoring of the CEO, American Economic Review 88, 96-118.
2. Management-friendly boards (Limbach)
Adams, R.B. and D. Ferreira, 2007. A Theory of Friendly Boards, Journal of Finance 62,
217-250.
3. Communication and decision-making in boards (Limbach)
Malenko, N., 2014. Communication and Decision-Making in Corporate Boards, Review of
Financial Studies 27, 1486-1532.
Part 2: Blockholder monitoring
4. Liquidity and control (Scholz)
Maug, E., 1998. Large Shareholders as Monitors: Is There a Trade-Off between Liquidity and
Control?, Journal of Finance 53, 65-98.
5. Governance through trading and intervention (Scholz)
Edmans, A. and G. Manso, 2011. Governance Through Trading and Intervention: A Theory
of Multiple Blockholders, Review of Financial Studies 24, 2395-2428.
6. Blockholder trading and managerial myopia (Lüdecke)
Edmans, A., 2009. Blockholder Trading, Market Efficiency, and Managerial Myopia, Journal
of Finance 64, 2481-2513.
Part 3: CEO turnover
7. CEO compensation, incentives and replacement (Strych)
Inderst, R. and H.M. Mueller, 2010. CEO Replacement Under Private Information, Review of
Financial Studies 23, 2935-2969.
8. CEO turnover in a competitive assignment framework (Hoang)
Eisfeldt, A.L. and C.M. Kuhnen, 2013. CEO turnover in a Competitive Assignment
Framework, Journal of Financial Economics 109, 351-372.
9. Governance and CEO turnover (Lüdecke)
Fisman, R.J., R. Khurana, M. Rhodes-Kropf, and S. Yim, 2014. Governance and CEO
Turnover: Do Something or Do the Right Thing?, Management Science 60, 319-337.
Introductory literature:
Hart, O., 1995, Corporate Governance: Some Theory and Implications, The Economic
Journal 105, 678-689.
Becht, M., P. Bolton, and A. Röell, 2003. Corporate Governance and Control, Handbook of
the Economics of Finance, Edited by G.M. Constantinides, M. Harris and R. Stulz,
2003 Elsevier B.V.
Dates:
The seminar consists of three parts (“Blockseminar”). The dates are:
Part 1: January 15 (topics 1-3), 14.00h - ca. 18.30h
Part 2: January 22 (topics 4-6), 14.00h - ca. 18.30h
Part 3: January 29 (topics 7-9), 14.00h - ca. 18.30h
Rules for the seminar:
Each student must compose his/her own term paper. The presentation is group
work. Each group (of 2 or 3 students per topic) has to make a 1-hour
presentation. Additional 15 minutes are scheduled for discussion. Attending the
seminar (at all scheduled days) is mandatory.
For more information about the seminar, please click on the following link:
http://finance.fbv.kit.edu/177.php
Registration and preliminary meeting:
Registration is only possible via the online registration system and
will start on September 1, 2015. Students will receive an
acceptance/ rejection notification on September 28, 2015.
To register for the seminar, please use the online registration system:
https://portal.wiwi.kit.edu/
On October 20, 2015, a preliminary meeting will take place at 13.10h in room
110 (Lehrstuhlbibliothek), building 20.13.
Contact: In case of any questions, please contact Dr. Peter Limbach: peter.limbach@kit.edu