Markus Schmid

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Prof. Dr.
Last Name
Schmid
First name
Markus
Email
markus.schmid@unisg.ch
Phone
+41 71 224 7001
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    Competition and the reputational costs of litigation
    (2025-03-14)
    von Meyerinck, Felix  
    ;
    Pursiainen, Vesa  
    ;
    Schmid, Markus  
    We study the role of competition in customers’ reactions to litigation against firms, using anonymized mobile phone location data. A class action lawsuit filing is followed by a 4% average reduction in customer visits to target firms’ outlets in the following months. The effect strongly depends on competition. Outlets facing more competition experience significantly larger negative effects. Closer competition matters more, both in terms of geographic and industry proximity. Announcement returns and quarterly accounting revenues around lawsuit filings also strongly depend on competition. Our results suggest that competition is an important component in customers’ ability to discipline firms for misbehavior.
    Type:journal article
    Journal:Journal of Financial and Quantitative Analysis
    Volume:60
    Issue:7
    DOI:10.1017/S0022109024000802
    URI:https://www.alexandria.unisg.ch/handle/20.500.14171/110532
    Scopus© Citations 3
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    Consequences of Data Errors for the Validity of the E-index as a Proxy for Corporate Governance
    (2021-07)
    Karthaus, Larissa
    ;
    von Meyerinck, Felix  
    ;
    Schmid, Markus  
    The E-index is one of the most widely used proxy variables for corporate governance in empirical research. We show that ISS data contain a significant number of measurement errors and misreported values. We use alternative databases to manually check deviations across databases and to construct a corrected E-index. We then revisit analyses conducted in three well-known and widely-cited studies using the E-index and compare results from using either ISS or corrected data to construct the E-Index. The results show that data errors in ISS result in a substantially overestimated negative association between the E-index and firm value. Moreover, data errors in ISS lead to incorrect conclusions regarding the relationship between the E-index and different measures of operating performance and analysts’ earnings forecasts. In summary, our results show that data quality is an important issue when measuring corporate governance.
    Type:working paper
    URI:https://www.alexandria.unisg.ch/handle/20.500.14171/110258