Economic partnerships and other transactions have some degree of information asymmetry between the contracting parties. As such, the information environment is vital when it comes to determining relationship quality and stability. In many markets, superior private information is seen as a competitive advantage when compared to publicly available information ... Read More

Television advertising plays a crucial role in shaping consumer behavior. It may also have a major influence on investment decisions, according to a novel study by HKUST’s Alminas Žaldokas and his colleague Jūra Liaukonytė from Cornell University. Their analysis of investor behavior revealed an increased interest in a company’s financial records immediately ... Read More

It is well known that financial market regulation has grown stronger over the years. For example, legislation has mandated that publicly-listed firms increase their transparency by disclosing more information in their financial statements. This level of disclosure has had the effect of reducing the cost of capital, levelling the information playing field for ... Read More

Research at HKUST informs the debate about the benefits of uniform financial regulation across countries and looks into the effects of the financial intermediation in facilitating international trade. By Associate Professor Alminas ZALDOKAS (left) and Assistant Professor Emilio BISETTI, Department of Finance at HKUST Business School International trade ... Read More

Innovating firms face a choice whether to patent its innovation or keep it as a trade secret. US National Science Foundation’s Business R&D and Innovation Survey in 2013 found that 41% R&D-doing firms find patents important and 67% find trade secrets important. Firms might consider that information disclosed in a patent is only imperfectly protected by the ... Read More

Price-fixing cartels are pervasive. However, antitrust enforcement around the world has been recently picking up speed. Higher fines and new tools such as leniency programs for cartel whistleblowers have led to unprecedented antitrust enforcement actions against the collusion and led to crumbling cartels. Theoretically, the breakdown of collusive activities ... Read More

In an earnings conference call with investors in 2008, Edward J Shoen, chief executive officer and chairman of U-Haul International, Inc., lamented that the Avis Budget Group, Inc., its main competition in one-way, do-it-yourself moving rental trucks, had failed to match U-Haul’s recent decision to raise prices. Calling the lack of response ‘unfortunate for ... Read More

Amid the turbulence in stock markets, retail investors continue to look for investment ideas. With thousands of publicly-traded stocks available, many retail investors often resort to their recent personal experiences when deciding on which stocks to buy or sell. In a recent paper, we find a predictable, recurring, and robust pattern between investor ... Read More

We introduce a new measure of innovation based on important product launches by public firms in the US. Our measure is based on stock-market reactions to media articles – classified by a convolutional neural network approach as referring to new product introductions – and has two distinct advantages. First, it covers the entire spectrum of industries and is ... Read More

Antitrust enforcement against price fixing, bid rigging, market allocation, and firms’ other agreements not to compete has been rising around the world. In light of these changing legal risks of falling under the radar of competition authorities, firms have been adapting their business models, corporate governance policies, securities issuance, and even ... Read More