Financial distress, short sale constraints, and mispricing
Pacific Basin Finance Journal Volume 53, February 2019, Pages 94-111   Kim, D.(a), Lee, I.(b), Na, H.(c) a Korea University Business School, Anam-ro, Seongbuk-gu, Seoul, 02841, South Korea b The Bank of Korea, 39 Namdaemun-ro, Jung-gu, Seoul, 04531, South Korea c Department of Finance and Law, College of Business and Economics, California State University, Los Angeles, United States   Abstract View references This paper specifically examine how the extent of the distress puzzle differs according to the degree of mispricing and short sale constraints. We find that the distress puzzle observed for overpriced stocks, not for underpriced stocks, becomes insignificant after adjustment for short sale constraints due to an asymmetric pricing effect of short sale constraints only on the short-leg side of distress. However, after adjustment for arbitrage risk, the distress puzzle remains unchanged. These results indicate that the distress puzzle is mainly attributable to short sale constraints, rather than other limits-to-arbitrages such as arbitrage risk, which has a bi-lateral pricing effect on both short-leg and long-leg sides of distress. To mitigate a possible endogeneity problem relation among financial distress, mispricing, and short sale constraints, we measure these variables with different timing. © 2018 Elsevier B.V. keywords Asymmetric pricing effect; Benchmark-adjusted returns; Degree of mispricing; Financial distress puzzle; Short sale constraints;  
2019.02.07
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Stuck between a rock and a hard place: Contrasting upward and downward effects of leaders’ ingratiation
Personnel Psychology Volume 71, Issue 4, Winter 2018, Pages 495-518   Kim, J.K.(a), LePine, J.A.(a), Chun, J.U.(b) a Arizona State University, United States b Korea University, South Korea Abstract Research indicates that leaders who engage in upward ingratiation, a specific form of impression management, develop positive relationships with their bosses, which in turn enhances leaders’ chances of achieving success at work. However, a more complete understanding of leaders’ ingratiation requires recognition that leaders have multiple audiences and that there may be negative unintended consequences of this behavior to at least one of these audiences. Specifically, upward ingratiation may reduce subordinates’ willingness to contribute to the organization through effective performance because it diminishes relationship quality between leaders and subordinates. To explore this issue, we develop and test a multilevel model that contrasts effects of leaders’ upward ingratiation on leader- and subordinate-level outcomes through the quality of social exchange in the corresponding relationship. We test our predictions by conducting a multiwave, multisource field study with a sample of 91 leaders, 91 bosses, and 215 subordinates in South Korea. Our findings reveal that upward ingratiation is positively associated with indicators of leaders’ intrinsic and extrinsic success because it enhances leader–boss exchange quality (LLX). In contrast, leaders’ upward ingratiation negatively influences subordinates’ job performance because it diminishes leader–subordinate exchange quality (LMX). We also find that subordinates’ perceptions of leaders’ political skill mitigate the negative indirect relationship between upward ingratiation and subordinates’ job performance via LMX quality, and that our hypotheses apply to ingratiation but not to other forms of impression management. We discuss the theoretical and practical implications of our findings in relation to ingratiation specifically and to impression management more generally. © 2018 Wiley Periodicals, Inc.  
2018.11.20
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