Catering through Nominal Share Prices

• 成果类型: Article
• 署名作者: Baker, Malcolm; Greenwood, Robin; Wurgler, Jeffrey
• 署名单位: Harvard University; National Bureau of Economic Research; New York University
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/j.1540-6261.2009.01511.x
• 发表日期: 2009
• 页码: 2559-2590
• 关键词: STOCK SPLITS; institutional investors; DISAPPEARING DIVIDENDS; PREDICTIVE REGRESSIONS; EXCESS COMOVEMENT; TICK SIZE; MARKET; INFORMATION; incentives; attention

摘要

We propose and test a catering theory of nominal stock prices. The theory predicts that when investors place higher valuations on low-price firms, managers respond by supplying shares at lower price levels, and vice versa. We confirm these predictions in time-series and firm-level data using several measures of time-varying catering incentives. More generally, the results provide unusually clean evidence that catering influences corporate decisions, because the process of targeting nominal share prices is not well explained by alternative theories.