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Kenneth R. Ahern

Associate Professor of Finance and Business Economics

Faculty Research Fellow, NBER




Curriculum Vitae

Google Scholar Page




Recent Research


Network Centrality and the Cross Section of Stock Returns

Journal of Finance, revise & resubmit

Industries that are more central in the network of intersectoral trade earn higher stock returns.






Information Networks: Evidence from Illegal Insider Trading Tips

Journal of Financial Economics, forthcoming

Illegal inside traders form networks based on long-lasting social relationships, earning returns of 35% in 21 days per tip.





Rumor Has It: Sensationalism in Financial Media

with Denis Sosyura

Review of Financial Studies, 2015

Media articles about large, public firms with recognizable brands are less accurate than articles about less newsworthy firms.





 Title: Peer Influence - Description: Using random assignment of MBA students to peer groups and predetermined survey responses of economic attitudes, we provide causal evidence that peer influence is one such environmental factor. We find positive peer effects in risk aversion, consistent with conformity, negative peer effects in honesty and altruism, consistent with self-interest, and no peer effects in trust. Overall, we show that fundamental attitudes, traditionally assumed to be immutable, are, in fact,
heavily influenced by social interactions, even in adults.


Peer Effects in Risk Aversion and Trust

with Ran Duchin and Tyler Shumway

Review of Financial Studies, 2014

Random assignment of MBA students to peer groups provides causal evidence that peers influence risk aversion.


Title: Stock Price Elasticity of Demand and the First Gulf War - Description: This figure represents the daily average stock price elasticity of Exxon, Schlumberger, and Dresser Industries (Oil Stocks) compared to the average daily elasticity for all other stocks (Non-Oil Stocks) over the period 11/01/1990 to 12/31/1991. The first
military conflict of the Persian Gulf War was on 01/17/1991 and is indicated by the vertical dashed line.

Do Common Stocks Have Perfect Substitutes?  Product Market Competition and the Elasticity of Demand for Stocks

Review of Economics and Statistics, 2014

Firms in more competitive industries are less substitutable and have less elastic demand curves for their stock.




Title: The Timber Industry Network (detail) - Description: The arrows point from suppliers to customers. The number on the top of the arrow is the percentage of input supplied to the customer industry. The number on the bottom of the arrow is the percentage of sales purchased by the customer industry from the adjacency matrix. 



The Importance of Industry Links in Merger Waves

with Jarrad Harford

Journal of Finance, 2014

Merger waves propagate across an economy through customer-supplier industry links.


Title: Abnormal Acquirer Newswire Coverage During Mergers - Description: This figure presents the average acquirer’s cumulative number of abnormal articles from newswires in daily event time relative to the public announcement of the merger. Abnormal articles are calculated as a firm’s daily number of articles divided by the average number of daily newswire articles in the pre-negotiation period (120 trading days prior to the beginning of merger negotiations). Time series are set to zero at event date −100 for comparison. ‘Fixed exchange ratio’ denotes bidders in stock acquisitions where the number of bidder’s shares to be issued for each target share is fixed. ‘Floating exchange ratio’ denotes bidders in stock acquisitions where the number of bidder’s shares to be issued for each target
share floats to achieve a particular price per target share. Data are from 507 acquisitions during

Who Writes the News?  Corporate Press Releases During Merger Negotiations

with Denis Sosyura

Journal of Finance, 2014

Firms influence their media coverage during private negotiations to improve the terms of trade in mergers.


Title: Cross-border activity for the 20 most active domestic M&A markets 1985–2008 (detail) - Description: Text size represents the number of domestic mergers within a nation. Line width represents the number of cross-border mergers. Direction points from acquirer to target when acquirer nation makes 50% more acquisitions of target than vice versa. The 20 most active domestic merger markets are determined by the total number of domestic mergers over 1985–2008, where acquirers and targets are public, private, and subsidiary firms listed on SDC Thompson Database.

Lost in Translation?  The Effect of Cultural Values on Mergers Around the World

with Daniele Daminelli and Cesare Fracassi

Journal of Financial Economics, 2015

Summarized in Finance and Accounting Memos, 2014

National cultural differences lead to fewer cross-border mergers and have a negative effect on wealth creation.



Title: Percentage of Women Directors and CEOs of Norwegian Public Limited Firms - Description: Data are from the annual reports of the 248 Norwegian public limited firms (Allmennaksjeselskap (ASA)) in our sample. Only shareholder-elected directors and CEOs are included in the sample. To be included, firms must have publicly-traded stocks and available stock price data in the Compustat Global database.

The Changing of the Boards: The Impact on Firm Valuation of Mandated Female Board Representation

with Amy Dittmar

The Quarterly Journal of Economics, 2012

A ground-breaking quota for women directors in Norway caused substantial changes to firm policy and value.



Title: Input/output relation between the paper mill industry and the gypsum products industry (detail) - Description: This figure depicts the customers of the paper mill industry on the bottom row and the suppliers of the gypsum products industry on the top row, arranged from left to right in descending order of the percent of paper mill sales (bottom) and percent of total input purchases by the gypsum product industry (top). The width of the lines indicating output (solid) and input (dashed) are proportional to the percent of total supplier sales and percent of total customer purchases. The ranking of these industries is also listed.

Bargaining Power and Industry Dependence in Mergers

Journal of Financial Economics, 2012

Targets with less product market dependence on an acquirer capture more of the gains in a merger.



Title: Rejection frequency of ME samples - Description: Probability of rejection of the null hypothesis that abnormal returns equal zero, when no abnormal performance is introduced. Samples are drawn from the highest and lowest market equity deciles. Critical values of 0.05 and 0.95 are generated from a standard normal distribution.

Sample Selection and Event Study Estimation

Journal of Empirical Finance, 2009

Event study samples have characteristics with known pricing biases; characteristic-based benchmarks help.



Title: Multiple Strategies for Growth - Description: Strength of benefit: High, Medium, Low for various restructing activities.

M&As: The Good, the Bad, and the Ugly

with J. Fred Weston

Journal of Applied Finance, 2007

In review, the neoclassical theory of mergers has more explanatory power than behavioral or redistribution theories.



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