John R. Nofsinger

John R. Nofsinger
University of Alaska Anchorage | UAA · Department of Accounting and Finance

PhD

About

165
Publications
81,471
Reads
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5,432
Citations
Citations since 2016
95 Research Items
3005 Citations
20162017201820192020202120220100200300400500
20162017201820192020202120220100200300400500
20162017201820192020202120220100200300400500
20162017201820192020202120220100200300400500
Additional affiliations
March 2020 - present
University of Alaska Anchorage
Position
  • Head of Faculty
August 2014 - present
University of Alaska Anchorage
Position
  • William H. Seward Chair in International Finance
August 2001 - May 2014
Washington State University
Position
  • Professor
Education
August 1992 - May 1996
Washington State University
Field of study
  • Finance

Publications

Publications (165)
Article
Full-text available
In response to Morningstar’s release of carbon risk (CR) scores in May 2018, (environmentally) sustainable mutual funds in the U.S. showed a greater reduction in their portfolio CR relative to conventional funds. The observed causal impact of this third-party disclosure is consistent with the funds’ primary investment objectives. Differences in fun...
Article
The US Inflation Reduction Act of 2022 imposed a 1% excise tax on share repurchases. We can learn from corporate reaction to such a new policy in India. The Indian federal government recently levied a 20 percent tax, plus surcharge, on share repurchases. We show that companies did not slow down their share repurchase initiation. However, to offset...
Article
Purpose The authors examine how local firms, regardless of industry, influence each other's corporate policies. The authors argue that there are two motives for why local firms may have similar corporate social responsibility (CSR) policies. First, the peer effect argues that a firm's chief executive officer (CEO) will likely interact regularly wit...
Article
We examine the caste affiliation of the auditor selected by the corporate boards of directors of Indian firms. The history of the caste system in India is one of discrimination and inequity. The constitutionally mandated quota system in the public sector has shown improvements, but has not trickled into private sector leadership. We find that nearl...
Article
We examine the market price and liquidity reaction to 239 share repurchase announcements in India. The average abnormal return on announcement day is 2.07 percent. Firms with larger promotor ownership stakes experience higher market reactions. Using the Amihud illiquidity measure and volume, we show that liquidity improves after the announcement. O...
Article
The underlying physiological mechanisms of biases are not well understood. As such, we examine the impact of testosterone and cortisol levels on several commonplace investment biases using realistic trading simulations. Cortisol, the biological marker of stress, is positively related to the disposition effect and portfolio turnover, which is consis...
Article
Family involvement as chair of the board combines the reputation of the controlling family and the firm. Thus, the family's incentive to prevent reputation loss acts as a corporate governance mechanism in mitigating self-serving and bad news hoarding behavior of family firms. We find a lower future stock price crash risk in family firms with family...
Article
We find positive and significant wealth transfers from individuals to institutions following a share repurchase. It appears that institutional investors are informed shareholders that use share repurchases as an opportunity to magnify the effect of their informational advantage over individual investors. On average, we find wealth transfers from in...
Article
Faccio et al. (2001) find that when East Asian firms have multiple large shareholders, they will collude to expropriate wealth and withhold dividend payouts. However, when it becomes difficult for large shareholders to expropriate wealth through activities like tunneling, large shareholders may then need dividends to fund personal cash flow needs....
Article
Institutional investors appear to have selective preferences regarding corporate social responsibility. They appear indifferent to the presence of positive environmental (E) and social (S) indicators, but underweight stocks with negative ES indicators. This asymmetric pattern is particularly strong for longer-horizon institutions. Our empirical ana...
Chapter
Historically, those traveling the financial highway were taught to follow a single route. Travelers were told that as long as everyone faithfully followed directions and weather conditions were ideal, the road would be their best choice and they would get to their intended destination....
Chapter
Have you ever made an investment decision based on how you feel about a company, its products, or its leadership? If so, you may suffer from an emotional bias , which is a distortion in perception and decision- making due to emotional factors. It...
Chapter
How investors behave can affect both their portfolio performance and the overall market. Because of a lack of formal training, limited experience, or personality traits, investors don’t always make decisions that are consistent with their stated financial goals. Their decisions often are impulsive and...
Chapter
How a situation or question is proposed can influence what people think of it. People react differently to “If you quit smoking, you will live longer” than to “If you don’t quit smoking, you will die sooner.” Although both statements provide the same information,...
Chapter
Billionaire investor Warren Buffett is known for his pithy insights. He once observed that in finance “you don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.” He also...
Chapter
People are prone to errors and biases that influence their decision- making. These mistakes can lead to bypassing rational thinking and relying on preconceived notions or intuition. Some biases are “hardwired” into the brain. Combining different behavioral biases can create a dangerous mixture that, if...
Book
People tend to be penny wise and pound foolish and cry over spilt milk, even though we are taught to do neither. Focusing on the present at the expense of the future and basing decisions on lost value are two mistakes common to decision-making that are particularly costly in the world of finance. Behavioral Finance: What Everyone Needs to KnowR pro...
Article
We examine the caste affiliation of corporate leadership in India. We find that the affirmative action policies targeted to the public sector have not filtered into the private sector. Indian boards are not very diverse—usually dominated by directors from a single caste. Boards dominated by one caste also tend to have a CEO from the same caste, put...
Article
Full-text available
Can firms overcome credit constraints with a corporate culture of high integrity? We empirically address this question by studying their investment–cash flow sensitivities. We identify firms with a culture of integrity through textual analysis of public documents in a sample of Chinese listed firms and also through corporate culture statements. Our...
Article
For more than 1500 private equity funds in China over the period from 1992 to 2013, we construct fund level performance metrics with investment level return data and examine performance and capital flows. The median (mean) fund IRR, net of fees, is 9.0% (51.7%), based on a sample that controls for survivorship bias. Fund IRRs are neither related to...
Article
Full-text available
Social media has reshaped business models, economies, politics, and culture around the world. In this paper, we identified social media stocks from various sectors by using a strict, academic definition and then studied their performance and return characteristics. Multivariate regression results demonstrate that being recognized as a social media...
Article
Full-text available
Is a firm that is known for positively engaging stakeholders expected to voluntarily disclose bad financial news? If it makes the announcement, does its corporate goodness help to mitigate the stock price reaction? We examine these issues using a sample of profit warnings, and a sample of firms with negative earnings surprises that did not warn. Fi...
Article
Full-text available
Purpose Financial analysts have been found to be overconfident. The purpose of this paper is to study the ramifications of that overconfidence on the dispersion of earnings estimates as a predictor of the US business cycle. Design/methodology/approach Whether aggregate analyst forecast dispersion contains information about turning points in busine...
Article
We examine the relation between testosterone, cortisol, and financial decisions in a sample of naïve investors. We find that testosterone level is positively related to excess risk-taking, whereas cortisol level is negatively related to excess risk-taking (correlation coefficient [r]: 0.75 and -0.21, respectively). Additionally, we find support for...
Article
Purpose This paper scrutinizes the impact of socioeconomic, political, legal and religious factors on the internal ethical values of human rights organizations (HROs) worldwide. The authors aim to examine the Code of Ethics for 279 HROs in 67 countries and the social and legal settings in which they operate. Design/methodology/approach Using the f...
Chapter
This chapter assesses the behavior of corporate managers and the board of directors within the framework of agency theory, stewardship theory, and psychological biases. In agency theory, a chief executive officer (CEO) is motivated to act in his own best interest rather than that of the shareholders. Stewardship theory posits that a CEO is a self-a...
Article
Chinese firms experienced a substantial reduction in nontradable shares following the Split-Share Structure Reform that began in 2005. The decrease in nontradable shares, or increase in share tradability, is associated with a decline in the firms’ cash dividend payouts. The positive association is attenuated in firms with fewer financial constraint...
Article
We develop and test an ownership structure pecking order. Our ownership pecking order sorts out which structures are likely to have relatively fewer agency costs versus higher agency costs. At the top of the pecking order are firms with a single controlling shareholder, they have the lowest agency costs when that shareholder is not the government....
Article
We test whether bank competition affects firms' leverage adjustment speeds. Using Chinese data where bank concentration varies across both years and provinces, we find that underlevered firms move to their target leverage faster when bank competition is high. Tests surrounding an exogenous shock to bank competition lead to the same conclusion. We a...
Article
We examine the market reaction of profit warnings (PWs) over the business cycle in the U.S. during 1995 to 2012. The average PW is associated with a −13.38% abnormal return during the announcement day. This is substantially higher than the abnormal return of firms who announce a negative earnings surprise without previously warning about it. We als...
Article
We find a positive relation between product market competition and corporate investment using a sample of Chinese manufacturing firms during 1999-2010. A quasi-natural experiment and change regressions yield consistent evidence. We postulate that China's high and predictable growth rate, as it transitions from a developing economy to a developed ec...
Article
As a part of the ongoing liberalization of the marketplace, Chinese regulators adopted the guideline called “Regulation of Equity Incentive Plans (trial)” to allow firms to provide employee incentives through employee stock option plans. Firms began initiating the plans in 2006. We investigate the impact of these plans on firm performance by compar...
Article
Full-text available
The creation of new businesses is vitally important to a healthy economy. Governments can enact laws and enforcement policies to foster and protect business. Or, the priority in some countries can be to protect employees and labor organizations. We examine how the business policies and laws enacted foster or inhibit new firm births in 19 countries....

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