CoChat
Sign Up
Cited by 690Corporate Finance and GovernanceAuditing, Earnings Management, GovernanceRisk Management in Financial Firms

The DOI matches its Crossref record; 80 of the 80 references it cites were found in a registry or an index.

Growing Out of Trouble? Corporate Responses to Liability Risk

Open access
Gormley, Todd A., Matsa, David A.·2011·Review of Financial Studies
DOI 10.1093/rfs/hhr011
Open this paper in CoChat — free accountOpen PDF

Abstract

This article analyzes corporate responses to the liability risk arising from workers' exposure to newly identified carcinogens. We find that firms, especially those with weak balance sheets, tend to respond to such risks by acquiring large, unrelated businesses with relatively high operating cash flows. The diversifying growth appears to be primarily motivated by managers' personal exposure to their firms' risk in that the growth has negative announcement returns and is related to firms' external governance, managerial stockholdings, and institutional ownership. The results suggest that corporate governance is particularly important when firms are exposed to the risk of large, adverse shocks.

Overview

The claims and statistics of this paper haven’t been checked yet.

Run the check — free, no account needed. It reads the open-access text and checks the sources it cites.

A few free checks a day · papers already verified open instantly · results are public

Integrity signals

Registry

Crossref · 10.1093/rfs/hhr011

Cites

80 of 80 references verified0 citation errors · 0 not checkable

Statistics

Verification

Claims the paper makes

The claims and statistics of this paper haven’t been checked yet.

Run the check — free, no account needed. It reads the open-access text and checks the sources it cites.

A few free checks a day · papers already verified open instantly · results are public

Claims other papers make about this one

Each is checked against this paper’s own text: does it say what the citing paper says it does?

Self-check

Percentages, sums and reported differences re-computed from the paper’s own numbers.

The self-check needs the paper’s full text.

Citations

Cites

Show all 75 references

Research works printed but not linked: 6

  1. Grossman SJ Hart OD . Corporate Financial Structure and Managerial Incentives. In: McCall J , editor. The Economics of Information and Uncertainty. Chicago: University of Chicago Press; 1982. p. 107-40.
  2. LeRoy, 1989, Workers' Compensation in Bankruptcy: How Do the Parties Fare?, Tort & Insurance Law Journal, 24, 593
  3. 10.2307/2729691 · DOI
  4. Moody's Investors Service. Default and Recovery Rates of Corporate Bond Issuers: A Statistical Review of Moody's Ratings Performance 1970–2001 2002.
  5. Peirce, 1988, Workers' Compensation and Occupational Disease: A Return to Original Intent, Oregon Law Review, 67, 649
  6. Treece, 1983, A Parent Corporation's Liability for the Torts of Its Subsidiary in the Context of the Exclusive Remedy Provision of the Workers' Compensation Laws, Insurance Counsel Journal, 50, 609

Cited by

Sorted by citations

Items 501–600 of 689

Related

See all

Metadata

Authors
Gormley, T. A., & Matsa, D. A.
Affiliations
  • Washington University in St. Louis (US)
  • Northwestern University (US)
ORCID
Gormley, Todd A.
Venue
Review of Financial Studies
Publisher
Oxford University Press (OUP)
Published
2011-04-11
Volume
24
Issue
8
Pages
2781-2821
ISSN
  • 0893-9454 (ISSN-L)
  • 1465-7368
DOI
10.1093/rfs/hhr011
OpenAlex
W2137816507
Cited by
690
References
75
Citations by year
2026: 90 · 2025: 136 · 2024: 113 · 2023: 70 · 2022: 56 · 2021: 59 · 2020: 39 · 2019: 21 · 2018: 27 · 2017: 24 · 2016: 19 · 2015: 10 · 2014: 7 · 2013: 13 · 2012: 4
FWCI
28.37
Type
journal article
Language
en
Open access
Locations
  • Review of Financial Studies (publishedVersion)
  • ScholarlyCommons (University of Pennsylvania) (submittedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Finance › Corporate Finance and Governance
  • Social Sciences › Business, Management and Accounting › Accounting › Auditing, Earnings Management, Governance
  • Social Sciences › Business, Management and Accounting › Accounting › Risk Management in Financial Firms
Keywords
liability risk, carcinogens, business diversification, unrelated acquisitions, corporate governance, institutional ownership, operating cash flow, balance sheet strength, adverse shocks

About these checks

Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.

Statistics and arithmetic are recomputed, not judged.

Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.

What counts as a claim ›How we measure confidence ›How we check this ›

Are you an author, or do you see a problem with this page? Request a review