Share reacquisitions,surplus cash,and agency problems

Share repurchases help alleviate agency costs of surplus cash by restricting management’s scope to waste corporate resources. But why do self-interested managers agree to disgorge surplus cash in the first place? This study examines the intervening effect of managerial monitoring and incentive alignment mechanisms on the decision to distribute excess cash through a share repurchase. Findings indicate that repurchases substitute for cash retention decisions that would otherwise prove costly for shareholders, and that better managerial incentive alignment and closer monitoring by external shareholders are important factors stimulating such payouts.     

Seasonal Migration and Networks—Evidence on Moldova’s Labour Exodus

Seasonal migration is an ever more important phenomenon worldwide, but has received little attention in empirical research. This paper investigates the choice of seasonal versus longer-term migration on a household level. We use data from Moldova, a country that is witnessing a massive emigration shock. Surprisingly, neither children nor marital status appear to influence the decision to leave seasonally or for longer periods. This suggests high social and emotional costs of emigration. We also find that existing local networks of seasonal migrants are unrelated to permanent migration choice. Generally, networks appear to have a stronger influence on migration probabilities in urban settings. JEL no. F22, J61, O15