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dc.contributor.authorLai, Syouching
dc.contributor.authorLi, Hungchih
dc.contributor.authorLi, Bin
dc.date.accessioned2018-08-17T01:38:17Z
dc.date.available2018-08-17T01:38:17Z
dc.date.issued2016
dc.identifier.issn0003-6846
dc.identifier.doi10.1080/00036846.2015.1096003
dc.identifier.urihttp://hdl.handle.net/10072/99776
dc.description.abstractWe explore the impact of corporate governance on firm performance. We first identify whether corporate governance can still be an influential factor or has been largely captured by the traditional Fama-French three-factor model. More importantly, our study adds a financial distress factor to the Fama-French three-factor model to form a four-factor pricing model (labelled as the ‘financial distress four-factor model’). We find that for the US Russell 1000 firms, the financial distress four-factor model is the better model of the two models considered. We further find that the financial distress four-factor model has a higher explanatory power in capturing the return variation. We find that the differences between the return of firms with good (weak) corporate governance and the expected return are insignificantly different from zero for most portfolios in all the two models. The financial distress four-factor model, however, has the fewer portfolios with return difference being significantly different from zero, implying that corporate governance has been better priced in the financial distress factor.
dc.description.peerreviewedYes
dc.languageEnglish
dc.language.isoeng
dc.publisherRoutledge
dc.relation.ispartofpagefrom1197
dc.relation.ispartofpageto1209
dc.relation.ispartofissue13
dc.relation.ispartofjournalApplied Economics
dc.relation.ispartofvolume48
dc.subject.fieldofresearchApplied economics
dc.subject.fieldofresearchApplied economics not elsewhere classified
dc.subject.fieldofresearchEconometrics
dc.subject.fieldofresearchcode3801
dc.subject.fieldofresearchcode380199
dc.subject.fieldofresearchcode3802
dc.titleDoes corporate governance still affect firm performance after controlling the distress factor?
dc.typeJournal article
dc.type.descriptionC1 - Articles
dc.type.codeC - Journal Articles
gro.hasfulltextNo Full Text
gro.griffith.authorLi, Bin


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