Finance Panel

The Clark Center for Global Markets explores finance professors’ views on vital policy issues via our Finance Panel.  We regularly poll over 40 individuals on a range of timely and relevant topics.  Panelists not only have the opportunity to respond to a poll’s statements, but an opportunity to comment and provide additional resources, if they wish. The Clark Center then shares the results with the public in a straightforward and concise format.

Please note that from September 2022, the language in our polls will use just two modifiers to refer to the size of an effect:

  • ‘Substantial’: when an effect is large enough that it would make a difference that matters for the behavior involved.
  • ‘Measurable’: when the direction of the effect is clear, but perhaps experts would differ as to whether it is substantial.
Finance

Publicly Traded Firms, Private Firms and the Economy

Question A:

The lower willingness of private firms to go public, combined with the increased number of publicly traded firms being taken private over the last 25 years, is measurably net negative for economic growth.

Responses

Source: Clark Center Economic Experts Panel
Methodology
Question B:

All else equal, reducing regulatory barriers (including reporting requirements such as Sarbanes Oxley 404) to public listing would substantially increase the share of publicly traded firms in the economy.

Responses

Source: Clark Center Economic Experts Panel
Methodology
Question C:

The lack of transparency about unlisted private firms' financial performance substantially hinders the efficiency of the allocation of capital.

Responses

Source: Clark Center Economic Experts Panel
Methodology
 
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Business, Management, & Corporate Performance
Finance

Quarterly Earnings

Question A:

Letting publicly traded firms report earnings annually rather than quarterly would lead their executives to place more weight on long-term issues in their investments and other decisions.

Responses

Source: Clark Center Economic Experts Panel
Methodology
Question B:

A switch from quarterly to annual earnings reports would, on net, benefit shareholders.

Responses

Source: Clark Center Economic Experts Panel
Methodology
 
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Business, Management, & Corporate Performance
Finance

Foreign Exchange Interventions

This Finance survey examines that it seems likely that Japanese authorities intervened in the foreign exchange market recently to prop up the yen – see, for example: https://www.ft.com/content/455784ec-0465-46ee-8c73-fc5ce3e31c37. In such circumstances, intervention refers to purchases or sales of domestic or foreign currency without changing the monetary policy stance (a) Large-scale intervention by public authorities in currency markets can move exchange rates substantially (b) The effectiveness of foreign exchange interventions can last beyond one month 
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International Finance
Finance

Retail Investor Participation in Private Equity

This Finance survey examines that Retail investors account for a large share of global wealth, but a small share in private equity holdings. (see link: https://bain.com/insights/why-private-equity-is-targeting-individual-investors-global-private-equity-report-2023/ (a) A reduction in the barriers to all retail investors investing in private equity funds - notably regulatory restrictions on investor wealth/income and on liquidity - would substantially improve household welfare. 
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Financial Regulation
Finance

Passive Investors and US Banks

This Finance survey examines: Regulator Probes BlackRock and Vanguard Over Huge Stakes in U.S. Banks – The WSJ reports that ‘The FDIC is scrutinizing whether the index-fund giants are sticking to passive roles when it comes to their investments in U.S. banks.' (a) The exemption of passive asset managers from banking rules - such as needing permission when they acquire shares above the 10% threshold - generates measurable risks to the accomplishment of the FDIC's mission 
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Banking
Finance

Short Selling and Asset Values

This Finance survey examines (a) Allowing short selling of financial securities, such as stocks and government bonds, leads to prices that, on average, are closer to their fundamental values; (b) When short sellers start to establish substantial short positions in a stock, the stock is likely to have been overvalued; (c) Requiring investors to disclose short positions in a stock at the equivalent threshold as they are required to do for long positions would improve the informativeness of stock prices 
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Financial Markets & Banking
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