Date of Award

Summer 2017

Document Type


Degree Name

Doctor of Philosophy (PhD)


Business Administration-Finance

Committee Director

Mohammad Najand

Committee Member

Kenneth Young

Committee Member

David Selover


Scholars have provided different theories that aim to explain merger waves throughout the years. However, a recent stream of the finance literature addresses the behavioral aspect behind mergers waves and imply that envy motivated CEOs tend to create merger waves. On the other hand, the decision to oust a CEO is considered one of the most important corporate decisions made in the lifetime of corporations. In Essay 1, we participate into the study stream by focusing on whether the incident of forced CEO turnover is higher during the late stages of merger waves where envy turns out to be more pronounced. Our evidence shows that late acquirers, who are motivated by envy, perform worse than early acquirers. Additionally, we document that the likelihood of a forced CEO turnover is significantly more pronounced for late acquirers during merger waves.

The catering theory suggests that dividend paying-firms trade at a discount for a prolonged period of time. Essay 2 investigates the performance of dividend paying-firms relative to non-paying firms in a setting that triggers pursue of safety for investors such as the financial crisis of 2007-2009. Specifically, we address whether the financial crisis alters investors’ preference towards dividend paying-firms. We find that payers outperform non-payers during the financial crisis. Further, the results document that non-payers with buybacks outperform non-payers with no buybacks. This indicates that payouts can function as an insurance mechanism for investors, and this justifies the discount placed on payers during normal economic periods.

Overall, this dissertation contributes to the literature by investigating whether the incident of CEO firings is more pronounced during the late stages of merger waves when envy mostly occurs. Further, we contribute to the literature by addressing the discount associated with dividend paying-firms. Given the vital role of CEOs to firm performance and the importance of dividends to the financial markets, the findings of this dissertation show important values for further academic research and industry implications.