Anya Nakhmurina

Importing activists: determinants and consequences of increased cross-border shareholder activism, with Mark G. Maffett and Douglas J. Skinner. Journal of Accounting and Economics, 2022, 74 (2-3): 101538.

We analyze nearly 7,000 shareholder activist campaigns across 56 countries and show that shareholder activism is now a global phenomenon. Our analyses provide evidence on factors that explain the spread of activism and two related questions. First, we measure the extent to which country-level governance regulations facilitate shareholder engagement, a necessary condition for activism, and show that our measure of shareholder-empowering governance regulation explains cross-country variation in the emergence of activism. Second, we show that changes in these regulations also affect outcomes for firms that face a high threat of activism but that are not targeted by activists (i.e., there are spillovers)—including increased profitability, higher payouts, and reduced investment. These effects are most pronounced in countries with weak minority shareholder rights, where activism had previously been relatively unimportant.

Financial constraints and short-term planning are linked to flood risk adaptation gaps in US cities, with Shirley Lu. Nature Communications Earth and Environment, 2024, 5, Article number: 43.

Adaptation is critical in reducing the inevitable impact of climate change. Here we study cities’ adaptation to elevated flood risk by introducing a linguistic measure of adaptation extracted from financial disclosures of 431 US cities over 2013-2020. While cities with a higher flood risk have higher adaptation, more than half of high-risk cities have below-average adaptation levels. We explore three factors associated with this adaptation gap, defined as a city’s adaptation being lower than predicted based on flood risk. We do not find that Republican cities are more likely to have an adaptation gap. Instead, our results point to the importance of financial constraints: cities with one standard deviation smaller unrestricted-fund-to-expense ratio are 6.6% more likely to have an adaptation gap. We also provide evidence on the importance of long-term planning: cities with a planning horizon shorter by one year are 4% more likely to have an adaptation gap.

Does fiscal monitoring make better governments? Evidence from US municipalities. The Accounting Review, 2024, 99 (4): 395-425.

This paper examines the effect of state-level monitoring on municipal governance, focusing on outcomes in financial reporting quality, local corruption, political entrenchment, and municipal financial soundness. I exploit the staggered adoption of fiscal monitoring policies that entail a regular review of municipal financial reports for signs of fiscal distress. I find that introducing these monitoring policies is associated with an increase in the proxies for reporting quality, a decrease in the number of corruption convictions, and a reduction in re-election likelihood for incumbent politicians. Consistent with the purpose of the policies, my evidence shows that fiscal health ratios of municipalities improve after initiating state monitoring. Collectively, my results are consistent with state fiscal monitoring improving several important aspects of municipal governance.

Working papers

Muni disclosures, with Christine Cuny, Ken Li, and Edward Watts. Latest draft: 2024.

This paper examines which municipal disclosures provide informational value to investors. Using the entire universe of post-issuance financial and event disclosures from 2009 to 2022, we find that most municipal bonds do not trade in the week of -- or the week after -- a disclosure filing. However, some disclosures do provide enough new information to heighten trading. Investors trade more on credit-relevant disclosures (such as construction progress updates and adverse credit event disclosures) and less on required annual financial statements. Trading after disclosure filings also increases more when a bond is large or risky. Our results collectively suggest that municipal disclosures only have informational value for some disclosure types and some issuers. In further analyses, we find that illiquidity, trading before the disclosure, and stale information contribute to the limited trading on the average disclosure. The findings suggest that reconsidering a one-size-fits-all approach to regulating municipal disclosures may be worthwhile.

Partisan cities, with Ramona Dagostino. Latest draft: 2024.

Using unique hand-collected data covering the political affiliation of 1,045 cities over the last two decades, this paper studies the implications of city-state partisan conflicts on the financing and provision of public goods.  Cities with the same political affiliation as the state governor face 8 basis points lower borrowing costs, as compared to misaligned cities.  These effects are stronger in states where governors are granted more powers, where cities are more fiscally dependent on the state, and for bonds issued by riskier borrowers. Consistent with state investments substituting for city-specific initiatives, we show that aligned cities reduce their investment in costly hazard preparedness projects when a same-party governor is elected.

Cities' climate mitigation disclosures, with Qianqian Li and Oleg Kiriukhin. Latest draft: 2024.

We study whether political polarization shapes US cities' disclosures on climate mitigation (i.e., net zero transition initiatives). Using textual analysis of cities' budgets and annual reports, we categorize these disclosures into two types: (i) tangible descriptions of ongoing projects and (ii) intent, the non-committal discussions of the high-level project purposes and future plans. We find that while there is partisan difference in the ongoing project disclosures, it remains stable over time, suggesting that political polarization doesn't affect the implementation of underlying projects. However, we observe a growing divergence in intent, which is inherently more discretionary as it reflects promises rather than concrete actions. Consistent with cities acting in accordance with the preferences of their stakeholders, we find similar results when we examine the cities' communications with the citizenry and disclosures directed at bondholders.

Newspaper notice as governmental transparency mechanism: Evidence from Florida, with Ivan Belousov and Delphine Samuels. Latest draft: 2024.

This paper studies the role of newspaper notices---legally required announcements published in newspapers to inform citizens about local government activities---on citizen engagement. We examine a recent Florida legislation revoking the requirement that public notices appear in newspapers, and allowing local governments to publish notices on county-operated websites instead. We find that local governments located in counties with a public notice website significantly reduce newspaper notice after the legislation, particularly for topics that tend to encourage citizen engagement, such as public hearings, planning and zoning proposals, or upcoming elections. By contrast, we find no discernible changes in website traffic of counties' public notice websites, suggesting a decrease in citizens' awareness of public notice. Finally, we find a significant increase in the number of commercial zoning permits after the legislation, consistent with the decline in newspaper notice of planning and zoning meetings reducing citizen activism against new construction. Overall, our results suggest that revoking notices from newspapers removes information about local government activities which reduces citizen engagement.