Title: Stock repurchase and agency problems - New evidence in Taiwan's stock market
Authors: Lo, Keng-Hsin
Wang, Kehuh
Yeh, Chun-Tsen
資訊管理與財務金融系 註:原資管所+財金所
Department of Information Management and Finance
Keywords: agency cost;agency problem;free cash flow;managerial ownership;stock repurchase
Issue Date: 1-Jan-2008
Abstract: This paper explores stock repurchase and agency issues in an emerging market with special regulations. Using match samples, agency-related variables are investigated for pre- and postannouncement periods. Our empirical evidence demonstrates that stock repurchase is related to agency cost mitigation, Agency problems are also significantly related to the preannouncement undervaluation of stock repurchase, after controlling for the effects of growth opportunity and asymmetric information. Finally, a company with a higher ratio of expected repurchase or higher agency costs normally enjoys better market response upon announcement.
URI: http://dx.doi.org/10.2753/REE1540-496X440105
ISSN: 1540-496X
DOI: 10.2753/REE1540-496X440105
Volume: 44
Issue: 1
Begin Page: 84
End Page: 94
Appears in Collections:Articles