Abstract Reviews the book "The Theory of Financial Decisions," by Charles W. Haley and Lawrence D. Schall.

A common dilemma faced by investors and portfolio managers is the tradeoff preference between risk and return. The general consensus and convention in finance and economics is that, in the aggregate, investors do not seek risk for its own sake. If so, it is reasonable to assume that returns on individual common stocks vary according to their risk. However, it is not the purpose of this paper to examine the ex post risk and return experience of various financial assets. This and related work have been treated by Sharpe [22] and by others. While some of these are studies of individual common stocks, the majority involves the ex post risk-return relationships of portfolios managed by institutional or professional investors. Although the conclusions are not totally consistent concerning the shape of the risk-return function, there is agreement that a generally positive relationship exists between risk and expected return. To date, little empiricism has been directed specifically to the ex ante risk-return preferences of individual common-stock investors. This paper takes a step in this direction by analyzing the ex ante risk-return preferences and expectations of individual common-stock investors. The purpose is two-fold: (1) to provide positive (as opposed to normative) evidence on the nature of the relationship between acceptable risk levels and expected annual rates of return; and (2) to examine the nature of this relationship between risk and the components of total return, income from dividends and capital appreciation.

The Journal of Corporate Finance (JCF) is a highly regarded academic journal specializing in corporate finance. The journal celebrated its silver jubilee year in 2018. We use scientometrics to analyze the journal's impact, prominent topics, most frequent authors, and their affiliated institutions and countries. Using network analysis, we group JCF publications into nine main clusters. Our study depicts the bibliographic couplings of authors and their affiliated institutions and countries, co-citations of journals, and co-occurrences of the authors' specified keywords. Using text mining techniques, we also present the major content of JCF titles, keywords, or abstracts in the form of word clouds.

This study shows that international firms listing their shares on the New York Stock Exchange (NYSE) or the London Stock Exchange (LSE) experience a significant increase in visibility, as proxied by analyst coverage and print media attention (The Wall Street Journal or Financial Times). The increase in analyst following is also associated with a decrease in the cost of equity capital after the listing event in a way consistent with Merton's (1987) investor recognition hypothesis. Our results are stronger for NYSE listing firms than for LSE listing firms. This may partially compensate firms for the higher costs associated with NYSE listing (compared to LSE listing).

We examine the impact of liberal judge ideology, as an exogenous proxy for litigation risk, on firms' choice of debt structure. In line with the substitution of governance mechanisms hypothesis, we find that U.S. firms headquartered in circuits dominated by liberal judges rely less on bank debt financing. We also show that the substitution away from bank borrowing arising from liberal judge ideology leads to a greater reliance on other financing alternatives, such as public debt and equity financing. Additional analyses indicate that the effect of liberal judge ideology is amplified for firms operating in competitive markets, firms facing tighter financial constraints, and firms with more growth opportunities. The governance substitution effect is, however, less pronounced for firms with higher institutional ownership. Overall, our findings suggest that, by exacerbating litigation risk, liberal judge ideology induces firms to trade-off creditor governance stemming from bank debt with governance by litigation, thus decreasing their reliance on bank debt in favor of alternative financing sources with less strict constraints and lower monitoring of managerial behavior.

ABSTRACT This study critically evaluates research published by Contemporary Accounting Research ( CAR ) between 1984 and 2021 using bibliometric analysis. We examine the following: (i) CAR 's publication quality and the factors associated with its citations and (ii) CAR 's scope regarding research diversity, methods, authors geographical dispersion, and collaborative networks. The methodology permits observation of finer collaboration details and research patterns not apparent by simply categorizing the data. We use tools such as performance analysis, coauthorship analysis, bibliographic coupling, and regression analysis. The bibliometric analysis shows improvement in CAR 's CiteScore and source‐normalized impact per paper over time, consistent with publishing high‐quality research. Our analysis reveals that authors' geographical affiliations, research subject areas, and research methods are not systematically associated with citations across our various subsamples. A notable exception is that research on audit topics generates more citations than studies examining financial accounting topics. Other factors significantly and positively associated with citations include article age, article length, number of authors, order of author names, and number of references. We also show that CAR has become more diverse regarding author affiliations, subject areas, and research methods than most leading accounting journals. Only Accounting, Organizations and Society emerges as more diverse, thereby serving as a benchmark for CAR in the future. CAR should consider focusing on high‐interest areas to boost citations and tightening its acceptance criteria.

We examine whether media coverage affects credit rating change decisions by analyzing 732,426 newspaper items published by top U.S. media outlets on S&P 1500 firms. Our results show that negative media coverage has a strong association with credit rating change events, but positive media coverage does not. We find support for two channels that confirm this finding: the media's fundamental information content and the media's reputational pressure. Credit rating agencies appear to consider the fundamental information embedded in negative media coverage and recognize negative market sentiment when making rating change decisions.