Key publications
Edmans A, Pu D, Zhang C, Li L (2023). Employee Satisfaction, Labor Market Flexibility, and Stock Returns Around the World.
Management ScienceAbstract:
Employee Satisfaction, Labor Market Flexibility, and Stock Returns Around the World
Studying 30 countries, we find that the link between employee satisfaction and stock returns is significantly increasing in a country’s labor market flexibility. This result is consistent with employee satisfaction having greater recruitment, retention, and motivation benefits where firms face fewer hiring and firing constraints and employees have greater ability to respond to satisfaction. Labor market flexibility also increases the link between employee satisfaction and current valuation ratios, future profitability, and future earnings surprises, inconsistent with omitted risk factors and identifying channels through which employee satisfaction may affect stock returns. The findings have implications for the differential profitability of socially responsible investing strategies around the world – in particular, the importance of considering institutional factors when forming such strategies.
Abstract.
DOI.
Albuquerque R, Koskinen Y, Yang S, Zhang C (2020). Resiliency of Environmental and Social Stocks: an Analysis of the Exogenous COVID-19 Market Crash.
The Review of Corporate Finance Studies,
9(3), 593-621.
Abstract:
Resiliency of Environmental and Social Stocks: an Analysis of the Exogenous COVID-19 Market Crash
Abstract
. The COVID-19 pandemic and the subsequent lockdown brought about an exogenous and unparalleled stock market crash. The crisis thus provides a unique opportunity to test theories of environmental and social (ES) policies. This paper shows that stocks with higher ES ratings have significantly higher returns, lower return volatility, and higher operating profit margins during the first quarter of 2020. ES firms with higher advertising expenditures experience higher stock returns, and stocks held by more ES-oriented investors experience less return volatility during the crash. This paper highlights the importance of customer and investor loyalty to the resiliency of ES stocks. (JEL G12, G32, M14)
. Received: June 3, 2020; editorial decision June 24, 2020 by Editor Andrew Ellul.
. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
Abstract.
DOI.
Chen Y, Kumar A, Zhang C (2020). Searching for Gambles: Gambling Sentiment and Stock Market Outcomes.
Journal of Financial and Quantitative Analysis,
56(6), 2010-2038.
Abstract:
Searching for Gambles: Gambling Sentiment and Stock Market Outcomes
Using Internet search volume for lottery to capture gambling sentiment shifts, we show that when the overall gambling sentiment is strong, investor demand for lottery stocks increases, these stocks earn positive short-run abnormal returns, managers are more likely to split stocks to cater to the increased demand for low-priced lottery stocks, and IPOs earn higher first day returns. Further, the sentiment-return relation is stronger among low institutional ownership firms, headquartered in regions where gambling is more acceptable and local bias is stronger. These results suggest that gambling sentiment has a spillover effect on the stock market.
Abstract.
DOI.
Albuquerque R, Koskinen Y, Zhang C (2018). Corporate Social Responsibility and Firm Risk: Theory and Empirical Evidence (Lead Article).
MANAGEMENT SCIENCE,
65(10), 4451-4469.
DOI.
Renneboog L, Ter Horst J, Zhang C (2011). Is ethical money financially smart? Nonfinancial attributes and money flows of socially responsible investment funds.
Journal of Financial Intermediation,
20(4), 562-588.
DOI.
Renneboog L, Ter Horst J, Zhang C (2008). The price of ethics and stakeholder governance: the performance of socially responsible mutual funds.
Journal of Corporate Finance,
14(3), 302-322.
DOI.
Publications by year
2023
Edmans A, Pu D, Zhang C, Li L (2023). Employee Satisfaction, Labor Market Flexibility, and Stock Returns Around the World.
Management ScienceAbstract:
Employee Satisfaction, Labor Market Flexibility, and Stock Returns Around the World
Studying 30 countries, we find that the link between employee satisfaction and stock returns is significantly increasing in a country’s labor market flexibility. This result is consistent with employee satisfaction having greater recruitment, retention, and motivation benefits where firms face fewer hiring and firing constraints and employees have greater ability to respond to satisfaction. Labor market flexibility also increases the link between employee satisfaction and current valuation ratios, future profitability, and future earnings surprises, inconsistent with omitted risk factors and identifying channels through which employee satisfaction may affect stock returns. The findings have implications for the differential profitability of socially responsible investing strategies around the world – in particular, the importance of considering institutional factors when forming such strategies.
Abstract.
DOI.
2022
Kumar A, Lei Z, Zhang C (2022). Dividend sentiment, catering incentives, and return predictability.
Journal of Corporate Finance,
72, 102128-102128.
DOI.
2021
Cuculiza C, Kumar A, Xin W, Zhang C (2021). Climate Change, Analyst Forecasts, and Market Behavior.
DOI.
2020
Albuquerque R, Lei Z, Rocholl J, Zhang C (2020). Citizens United vs. FEC and corporate political activism.
Journal of Corporate Finance,
60, 101547-101547.
DOI.
Albuquerque RA, Koskinen Y, Yang S, Zhang C (2020). Love in the Time of COVID-19: the Resiliency of Environmental and Social Stocks.
DOI.
Albuquerque R, Koskinen Y, Yang S, Zhang C (2020). Resiliency of Environmental and Social Stocks: an Analysis of the Exogenous COVID-19 Market Crash.
The Review of Corporate Finance Studies,
9(3), 593-621.
Abstract:
Resiliency of Environmental and Social Stocks: an Analysis of the Exogenous COVID-19 Market Crash
Abstract
. The COVID-19 pandemic and the subsequent lockdown brought about an exogenous and unparalleled stock market crash. The crisis thus provides a unique opportunity to test theories of environmental and social (ES) policies. This paper shows that stocks with higher ES ratings have significantly higher returns, lower return volatility, and higher operating profit margins during the first quarter of 2020. ES firms with higher advertising expenditures experience higher stock returns, and stocks held by more ES-oriented investors experience less return volatility during the crash. This paper highlights the importance of customer and investor loyalty to the resiliency of ES stocks. (JEL G12, G32, M14)
. Received: June 3, 2020; editorial decision June 24, 2020 by Editor Andrew Ellul.
. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.
Abstract.
DOI.
Chen Y, Kumar A, Zhang C (2020). Searching for Gambles: Gambling Sentiment and Stock Market Outcomes.
Journal of Financial and Quantitative Analysis,
56(6), 2010-2038.
Abstract:
Searching for Gambles: Gambling Sentiment and Stock Market Outcomes
Using Internet search volume for lottery to capture gambling sentiment shifts, we show that when the overall gambling sentiment is strong, investor demand for lottery stocks increases, these stocks earn positive short-run abnormal returns, managers are more likely to split stocks to cater to the increased demand for low-priced lottery stocks, and IPOs earn higher first day returns. Further, the sentiment-return relation is stronger among low institutional ownership firms, headquartered in regions where gambling is more acceptable and local bias is stronger. These results suggest that gambling sentiment has a spillover effect on the stock market.
Abstract.
DOI.
2019
Kumar A, Xin W, Zhang C (2019). Climate Sensitivity and Predictable Returns.
DOI.
Chen Y, Kumar A, Zhang C (2019). Social Sentiment and Asset Prices.
DOI.
2018
Albuquerque R, Koskinen Y, Zhang C (2018). Corporate Social Responsibility and Firm Risk: Theory and Empirical Evidence (Lead Article).
MANAGEMENT SCIENCE,
65(10), 4451-4469.
DOI.
2017
Kumar A, Lei Z, Zhang C (2017). Dividend Sentiment, Catering Incentives, and Return Predictability.
DOI.
SORGE M, ZHANG C, KOUFOPOULOS K (2017). Short-Term Corporate Debt around the World.
Journal of Money, Credit and Banking,
49(5), 997-1029.
DOI.
2016
Lei Z, Zhang C (2016). Leveraged buybacks.
Journal of Corporate Finance,
39, 242-262.
DOI.
Renneboog L, Horst JT, Zhang C (2016). Socially Responsible Investment Funds. In (Ed)
A Handbook of Corporate Governance and Social Responsibility, 395-412.
Abstract:
Socially Responsible Investment Funds
Abstract.
DOI.
2015
Albuquerque RA, Lei Z, Rocholl J, Zhang C (2015). Citizens United vs. FEC and Corporate Political Activism.
DOI.
Goergen M, Renneboog L, Zhang C (2015). Do UK Institutional Shareholders Monitor their Investee Firms?.
Journal of Corporate Law Studies,
8(1), 39-56.
DOI.
2014
Edmans A, Li L, Zhang C (2014). Employee Satisfaction, Labour Market Flexibility, and Stock Returns Around the World. NBER Working Paper No. 20300.
2013
Sorge M, Zhang C, Koufopoulos K (2013). Short-term Corporate Debt Around the World.
DOI.
2012
Renneboog L, Horst JT, Zhang C (2012). Money-Flows of Socially Responsible Investment Funds around the World. In (Ed)
Socially Responsible Finance and Investing: Financial Institutions, Corporations, Investors, and Activists, 455-477.
Abstract:
Money-Flows of Socially Responsible Investment Funds around the World
Abstract.
DOI.
2011
Renneboog L, Ter Horst J, Zhang C (2011). Is ethical money financially smart? Nonfinancial attributes and money flows of socially responsible investment funds.
Journal of Financial Intermediation,
20(4), 562-588.
DOI.
2009
Sorge M, Zhang C (2009). Currency and Maturity Mismatches in Latin America. In (Ed)
The Banking Crisis Handbook, 353-372.
DOI.
Sorge M, Zhang C (2009). Currency and maturity mismatches in latin america. In (Ed)
The Banking Crisis Handbook, 353-372.
Abstract:
Currency and maturity mismatches in latin america
Abstract.
DOI.
Palomino F, Renneboog L, Zhang C (2009). Information salience, investor sentiment, and stock returns: the case of British soccer betting.
Journal of Corporate Finance,
15(3), 368-387.
DOI.
Renneboog L, Horst JT, Zhang C (2009). Is Ethical Money Financially Smart? the Impact of Non-Financial Investment Attributes.
DOI.
2008
Goergen M, Renneboog L, Zhang C (2008). Do UK Institutional Shareholders Monitor Their Investee Firms?.
DOI.
Palomino F, Renneboog L, Zhang C (2008). Information Salience, Investor Sentiment, and Stock Returns: the Case of British Soccer Betting.
DOI.
Renneboog L, Ter Horst J, Zhang C (2008). Socially responsible investments: Institutional aspects, performance, and investor behavior.
Journal of Banking & Finance,
32(9), 1723-1742.
DOI.
Renneboog L, Horst JT, Zhang C (2008). The Price of Ethics and Stakeholder Governance: the Performance of Socially Responsible Mutual Funds.
DOI.
Renneboog L, Ter Horst J, Zhang C (2008). The price of ethics and stakeholder governance: the performance of socially responsible mutual funds.
Journal of Corporate Finance,
14(3), 302-322.
DOI.
2007
Renneboog L, Horst JT, Zhang C (2007). Socially Responsible Investments: Methodology, Risk Exposure and Performance.
DOI.
Horst JT, Zhang C, Renneboog L (2007). Socially Responsible Investments: Methodology, Risk and Performance.
DOI.
Renneboog L, Horst JT, Zhang C (2007). The Price of Ethics: Evidence from Socially Responsible Mutual Funds.
DOI.
2006
Renneboog L, Horst JT, Zhang C (2006). Is Ethical Money Financially Smart?.
DOI.
Horst JT, Zhang C, Renneboog L (2006). The Price of Ethics: Evidence from Mutual Funds.
DOI.
2005
Palomino F, Zhang C, Renneboog L (2005). Information Salience and News Absorption by the Stock Market: the Peculiar Case of Betting Markets.
DOI.
Bellemare C, Krause M, Kröger S, Zhang C (2005). Myopic loss aversion: Information feedback vs. investment flexibility.
Economics Letters,
87(3), 319-324.
DOI.
Palomino F, Zhang C, Renneboog L (2005). Stock Price Reactions to Short-Lived Public Information: the Case of Betting Odds.
DOI.
2004
Bellemare C, Krause MU, Kröger S, Zhang C (2004). Myopic Loss Aversion: Information Feedback vs. Investment Flexibility.
DOI.
2003
Bellemare C, Krause M, Kröger S, Zhang C (2003). Myopic Loss Aversion, Information Dissemination, and the Equity Premium Puzzle.
DOI.