Dr. Teall’s primary research activities have been concentrated in the area of corporate control, though his interests in applications of quantitative technique have led to other research topics as well. More generally, Dr. Teall’s current research interests are:
|Research in Progress||Books|
|Working Papers||Other Publications|
|Refereed Journal Articles||Dissertation|
"IPOs, Clustering, Indirect Learning and Filing Independently," with H. Colaco and J. Knopf.
“European Integration and Executive Compensation Structures: Results from Bargaining and Merger Activity,” with J. Knopf.
"Power Indices and Corporate Voting Rights."
"On the Estimation of Security Variance: A Review of Techniques."
Refereed Journal Articles
Journal articles will be linked as the links become available. Adobe Acrobat will be needed to read most papers linked to here.
Real Estate Taxation and Commercial Mortgage Underwriting," with L. Shilton and J. Webb: Decision Sciences: September/October 1992.
"Merger Activity and Managerial Compensation," Review of Financial Economics: Fall 1992.
"Shareholder Control and Financial Distress in the Thrift Industry," Journal of Business Research: February 1993.
"Option Based Prediction of Commercial Mortgage Defaults," with L. Shilton: Journal of Real Estate Research: Spring, 1994.
"Voting and Power in the Small Firm: Alternatives to the One Share One Vote Rule," with R. Goon: Journal of Small Business Finance: vol.3,#4, 1993/94.
"A Binomial Model for Valuation of Corporate Voting Rights," Journal of Business Finance and Accounting, June 1996.
"Risk-Taking Behavior in the U.S. Thrift Industry: Ownership Structure and Regulatory Changes," with J. Knopf, Journal of Banking and Finance vol. 20,#8, 1996.
"Thrift Size, Risk-Taking and Return Performance," with J. Knopf, Managerial Finance vol. 23,2, 1997.
"The Range of Brownian Motion Processes: Density Functions and Derivative Pricing Applications," with K. Sutrick, A.Tucker and J. Wei, Journal of Financial Engineering vol. 6,#1, 1997.
"Managerial Compensation and the Optimality of Dual Class Capitalization." Review of Financial Economics vol. 6,#2, 1997.
"The IPO Effect and Measurement of Risk," with J. Knopf, Journal of Financial and Strategic Decisions vol.12,#2, 1999.
“The Impact of SEC Registration Requirements on IPO Underpricing,” with J. Knopf, Journal of Research in Finance vol. 3, Winter 2000.
"Shareholder Wealth, Risk-Taking and Thrift Institution Governance," with J. Knopf, Journal of Financial and Economic Practice, Fall, 2003.
"Power Indices and Evaluating the FLP Minority Discount," The Business Review, Cambridge, vol.2#1, Summer, 2004.
"Estimating Securities Returns Variance: A Review of Techniques for Classroom Discussion," Journal of Economics and Finance Education, vol.3, #2, Winter 2004.
"Internet-Based Trading and Open Outcry Markets: The Changing Roles of Options Exchanges and Market Makers," Journal of Internet Business , September, 2005.
"Modi Operandi of U.S. and European Fraud: Focus on Parmalat," The Business Review, Cambridge 5, December, 2006.
"Family Limited Partnerships and Control Premiums," forthcoming, Financial
Services Review, Summer 2007.
Books and Other Publications
Governance and the Market for Corporate Control , London, U.K.: Routledge Publishers , 2007.
Quantitative Methods for Finance and Investments with I. Hasan, Oxford, UK: Blackwell Publishers , 2002.
Financial Market Analytics , Westport, Connecticut: Greenwood Publishing Group , 1999.
"Valuing Corporate Voting Rights with Power Indices" (Note), Financial Management: Winter 1992.
"The Effects of Government Regulation on Financial Institution Stability: The U.S. Experience," with J. Knopf, Chapter Four in Subhashis Gangopahday, Wilma Wadwa and Clas Wihlborg, eds.: Enabling Financial Markets: Institutions and Regulations, United Nations Development Program, New Dehli: Allied Publications Limited, 1996.
"The Rational Valuation of Corporate Voting Rights" (Abstract), Proceedings of the 1994 Western Social Sciences Association.
"The One Share-One Vote Rule: Is it Really Optimal?" Proceedings of the 1995 Meetings of the Mid-South Academy of Economics and Finance.
"Firm Size and Performance in the Savings and Loans Industry," with J. Knopf, (Abstract), Proceedings of the 1995 Meetings of the Global Finance Association.
"The One-Share, One-Vote Rule and Managerial Compensation." (Executive Summary), Proceedings of the 1995 Meetings of the European Financial Management Association.
"Brownian Motion Ranges and Pricing the Do-Nothing Option." (Executive Summary), Proceedings of the 1996 Meetings of the European Financial Management Association, with K. Sutrick, A. Tucker and J. Wei.
"On the Estimation of Security Variance: A Review of Techniques." (Abstract), Proceedings of the 1997 Meetings of the Academy of Accounting and Financial Studies.
"Merger Activity and Managerial Compensation"
Committee: W. Michael Keenan (Chair), Yakov Amihud, John Cheh and Kose John
This dissertation is intended to explain relationships between methods and levels of managerial compensation and merger activity. The theoretical economy presented in the paper takes place in a monopolistic competitive environment with finite numbers of managers and employing firms. Firms are distinguished by their abilities to generate profits (size) and managers are distinguished by their innate capabilities.
The Bargaining Set concept from Game Theory is employed to solve the managerial assignment problem. A fixed managerial compensation scheme based on competitive bidding for management services is derived where more capable managers obtain employment from larger firms. Conditions are defined for mergers to be profitable to shareholders of both acquiring and target firms. However, the model indicates that when managerial compensation is based on fixed salaries, target firm managers will oppose mergers; potential acquiring firm managers will never initiate mergers unless they are able to secure for themselves a sufficient share of the merger surplus. Except under restricitve assumptions, a free-rider problem will result from firms paying managers fixed bonuses for initiating merger activity. This problem is caused by each firm finding more profit in becoming acquired than paying a competent manager. In this case, no firm will hire a competent manager and no merger will be consummated.
Managerial stockholdings is proposed as a means to eliminate the free-rider problem and to encourage profitable merger activity. Levels of managerial holdings necessary to entice managerial pursuit of profitable mergers are derived. This dissertation shows how managerial stock purchases can be interpreted as signals of their abilities. However, if managers themselves are uncertain as to their abilities, and they are risk averse, their desired shareholdings may be insufficient to induce merger and signalling activity.
Results in Chapters Three and Four are based on linear managerial production functions where the (n) firm economy may collapse to one firm. The introduction of finite optimal managerial spans of control (diseconomies of scale) results in a constant (z*) firm economy where each firm's size is a function of its manager's ability. However, when outcomes are uncertain, the paper shows that merger activity may be necessary for firms to maintain their optimal sizes.