This article examines whether data from remote sensing satellites can be used to predict lithium mine output. We use pixel classification of land cover to measure long-term mine expansion and nightly light emissions to measure short-term operational activities. We find a strong correlation between satellite data in one period and individual lithium mine production volumes in the following period. Our rapid and cost-effective method of forecasting lithium mine production can help decision-makers in companies that rely on lithium, and policymakers seeking to ensure adequate lithium supplies in their countries.

We investigate the interplay between corporate innovation (technological and product innovation) and corporate financing. Splitting up corporate innovation allows for a more precise identification of optimal financing strategies. Using a large sample of U.S. public firms between 1990 and 2015, we find that technological and product innovation increases after a seasoned equity offering (SEO). Firms that financed the commercialization (product innovation) of a prior successful technological innovation with debt tend to show higher firm performance post-SEO. This supports the narrative of an optimal financing strategy for corporate innovation. Our results remain robust after addressing selection bias and endogeneity concerns.

The cryptocurrency market operates continuously, leading to frequent price fluctuations and information dissemination. This can hinder investors from reacting promptly to market changes, a phenomenon attributed to investors' limited attention. Research in traditional markets shows that the limited attention bias allows successful implementation of momentum strategies. However, past research on cryptocurrency markets finds mixed results. To resolve the puzzle, we utilize a survivorship bias-free dataset while accounting for variations in market capitalization and trading volume. This differentiation is crucial given young and tech affine retail investors' inclination toward smaller-capitalized cryptocurrencies, due to their higher risk tolerance and limited attention. More risk averse investors such as institutional investors, in contrast, focus more on top cryptocurrencies. In line with expectations, we find effective momentum strategies among larger-capitalized cryptocurrencies.

As the 2024 U.S. presidential election looms, the intersection of cryptocurrency and political finance has garnered significant interest. This study explores the new crypto category of PolitiFi, which merges politics and finance and is linked to political figures and agendas. Our analysis underscores the strategic deployment of these tokens to enhance visibility, shape narratives, and appeal to younger, more technologically adept voters within the crypto sphere. The alignment of cryptocurrency adoption with voter demographics highlights PolitiFi's potential to redefine political engagement and campaign strategies, and influence election outcomes. Empirical analyses show that PolitiFi's development has exhibited a distinct trajectory, rapidly demonstrating independence and a critical decoupling from other meme coins in the cryptocurrency market.

This paper examines how political connections shape media bias and contribute to regulatory noncompliance in China's capital markets. Using a large sample of news articles on publicly listed non-state-owned enterprises (non-SOEs), we find that politically connected firms receive significantly more favorable media coverage than their unconnected peers. A difference-in-differences analysis exploiting a regulatory shock—China's Rule 18 anti-corruption regulation—that forced politically connected directors to resign confirms the link between political ties and biased reporting. Around corporate scandals, politically connected firms face softer media scrutiny, weakening reputational penalties. Critically, we show that this media shielding effect increases the likelihood of repeated regulatory violations. These findings highlight the social costs of the “scandal-covering” role of political connections, which not only distort the information environment but also undermine regulatory deterrence and market discipline.

This paper investigates the performance of venture capital-backed (VC-backed) firms upon their exits through mergers with special purpose acquisition companies (SPACs) or “more traditional” initial public offerings (IPOs) during the recent SPAC wave. Compared to their IPO peers, VC-backed ventures merging with SPACs tend to exhibit smaller size, less current and analyst-projected future profitability, and additional characteristics that indicate lower venture quality. Notably, SPACs merging with VC-backed ventures demonstrate significant underperformance relative to both SPACs merging with non-VC-backed companies and “standard” IPOs. This suggests that VCs may have exploited a relative lack of regulation and investor naivety. They may have presented their lower-quality ventures as appealing opportunities for mergers with SPACs, which resulted in their substantial underperformance.

Recent global crises, such as the COVID-19 pandemic, severe supply chain disruptions, and ongoing geopolitical tensions, have profoundly reshaped the entrepreneurial and financial landscapes. This Special Issue of the Small Business Economics Journal explores these transformations. Key insights include the impact of unconventional monetary policy on SME financing, the success factors of bailout programs, the critical role of active investors in fostering firm resilience, the implementation of digitizing technologies, and the adoption of survival strategies on a microeconomic level. Together, these findings underscore the flexibility and resilience of entrepreneurs and offer actionable lessons for policy and practice. Extended periods of crises reshape entrepreneurial finance markets—spurring digital innovation, resilient business models, and new designs of bailout programs. Recent global crises, including the COVID-19 pandemic, the Ukraine war, and inflation, have disrupted economies, forcing entrepreneurs to adapt quickly. Challenges such as tighter financing conditions, supply chain disruptions, and rising costs drove businesses to adopt innovative strategies, e.g., raising (bailout) capital, revamping inventory management, and employing digital financial tools. While many ventures struggled with higher costs and uncertain markets, the adaptability of entrepreneurs demonstrated their vital role in economic resilience. This special issue collects timely papers that underline this resilience and provides managerial and policy recommendations for future crises. This paper summarizes the findings about the importance of fostering entrepreneurial ecosystems through targeted financial support policies, digital transformation initiatives, and managerial adaptions to enhance economic resilience during periods of extended crises.

Much of the media focus surrounding Bitcoin (BTC) has been on the 'E' (environmental) element of the ESG investing approach. Given the amount of electricity consumed by BTC mining, and the resulting large carbon emissions, BTC has faced substantial criticism of its overly negative environmental impact, which is critically reviewed in this article. This one-sided discussion, however, ignores the 'S' (social) and 'G' (governance) elements entirely. To remedy that, we explore BTC's positive impact on the 'S' (user satisfaction, data protection and privacy, human rights, and criminal activity), and 'G' (accounting integrity and transparency, compensation, and principles of good governance) components.

This paper investigates the relationship between CEO activism and corporate ESG-scores. We analyze whether CEOs’ public engagements on environmental and sociopolitical matters, although tangential to their primary business activities, impact firms’ subsequent ESG ratings. Drawing upon signal theory, we hypothesize that ESG rating agencies may interpret CEO activism as a credible indicator of authentic leadership and advocacy on environmental and sociopolitical issues. Our empirical results affirm a positive correlation between activism and ESG ratings.

This paper explores whether and how political connections affect the market for corporate bonds issued by privately owned enterprises (POEs) in China. We test two competing theories – the zero-default myth and the borrower channel theory – that offer alternative explanations for the effect of political connections on the likelihood of bond issuance, the costs of refinancing, the market reaction to a bond issue announcement, and the performance of the firm after the bond has been issued. Using a sample of Chinese POEs from 2007 to 2016, we show that – in line with the zero-default myth theory – politically connected POEs are more likely to issue corporate bonds as a debt financing instrument than their non-connected counterparts. They also achieve lower coupon rates (i.e., lower refinancing costs), despite exhibiting lower overall performance after bond issuance. We find that investors react positively to corporate bond-issuing announcements if the issuing firm is politically connected. At the same time, our research indicates that politically connected bond-issuing POEs in China have weaker corporate governance and a surprisingly higher default probability than non-connected issuers.

GameFi is a portmanteau of "game" and "finance." The concept involves blockchain games that offer economic incentives to play, otherwise known as play-to-earn (P2E) games. We explain in detail how GameFi differs from traditional games, and carve out its unique value proposition. We also explore how the mechanics of blockchain games influence the social facet of P2E games, where guilds and clans essentially function as profit-sharing organizations. GameFi leverages disparate elements of the crypto space: tokens, DeFi, and NFTs. Lastly, we discuss in detail some of the challenges of GameFi.

Using a sample of 18,225 global buyouts, we find that management buyouts (MBOs) are significantly more likely to occur if economic policy uncertainty (EPU) increases. This finding is consistent with the idea that EPU provides an opportunity for insiders to capitalize on private information and time the market. Further results suggest that market timing pays off on average. We find that MBOs achieve more favorable buyout prices and greater post-buyout operating improvements than institutional buyouts during times of high EPU. Our results hold when exploiting close national election races as a quasi-natural experiment for EPU.

This paper examines the relationship between investor fear in the cryptocurrency market and Bitcoin prices by considering the potential effects of the ongoing COVID-19 pandemic during the period of May 5, 2018 and December 10, 2020. The existence of structural changes in the time series for the full sample reveals a non-constant causality between fear sentiment and Bitcoin prices, which leads us to apply a bootstrap rolling window Granger causality test. Our results show that both negative and positive interactions between fear sentiment and Bitcoin prices occur during several subperiods. The nature of these interactions changes significantly before and during the pandemic. Thus, we contribute to the fast-growing literature on the financial effects of the COVID-19 global pandemic, as well as to the debate on whether to classify Bitcoin as a new asset, speculative investment, currency, or safe haven asset.

Taking ventures public is the most rewarding exit alternative to venture capitalists (VCs) in terms of financial returns and reputational gains. However, in recent years, special purpose acquisition vehicles (SPACs) have served to bring companies public without the delay of an IPO process and wihout its bureaucratic burden. VCs have therefore increasingly used this new exit channel which ranges between IPOs and sales to financial intermediaries (i.e., secondary transactions). We refer to prominent theory about VC exits as IPOs or “secondaries” under information asymmetry. The patterns we find for VC SPAC exits do not match the theory predictions. We find that VC-backed SPAC targets are not younger and neither shorter nor longer in VCs’ portfolios. They also do not require more nor less aggregate capital contributions or financing rounds. However, they are smaller in book values, less profitable, have lower market capitalizations and lower Tobin’s Qs compared to their IPO peers. There is a merger announcement return of 8.1% for VC backed SPACs but dissipating quickly afterwards. There is no underpricing on the merger day and aftermarket performance is dreadful. No NPV from the SPAC merger is left for public shareholders, and this leads us to conclude that VC SPAC exits are motivated by opportunism. VCs exploit the window of SPAC opportunities and leave no money on the table.

This paper investigates whether private equity (PE)-backed acquirers have a “parenting advantage” in the mergers & acquisitions (M&A) market. We employ a sample of 788 PE-backed firms and a carefully matched control group of 6,652 non-PE-backed peers, for which we observe the entire acquisition history over a 19-year time span. Difference-in-differences estimates suggest that PE backing induces a sizeable but short-lived boost to acquisition activity, while the type and complexity of acquisitions are similar to those of non-PE-backed peers. These results are consistent with the idea that PE backing enhances execution and speed in the M&A market. We find that portfolio firms benefit from this boost through improved valuations and margins. The extent to which this is true, however, depends on the institutional setting of the PE owner. Our results indicate that add-on acquisitions are detrimental if PE owners are late buyers or suffer from limited attention problems.

A key objective of shareholder activists is to persuade a firm’s management to change its strategy. CFOs play an important role in negotiations, nonetheless activism research mainly focuses on CEOs. We examine the relationship between CFO overconfidence and the likelihood to get targeted by activists. Using established overconfidence measures, we provide evidence that activists take CFO overconfidence into account when deciding to invest in a firm with firms managed by overconfident CFOs being significantly less likely to get targeted. These effects increase with the strength of CFO overconfidence and persist for different overconfidence proxies. Firms with overconfident CFOs also exhibit less positive abnormal returns after activism events. These results extend recent evidence by indicating that activists also focus on a target firm’s CFO and are likely to take the negotiation willingness of a potential target's executives into account when deciding whether to invest in a company.

The digital world is increasing humanity's ability to acquire, produce, distribute, and consume information at unprecedented levels, raising questions about the origin, reliability, and use. This introduction is related to the special issue on Technological Innovations to Ensure Confidence in the Digital World, which will bring together relevant papers about technological innovations to ensure confidence in the digital world. The papers included in the special issue focus on trust issues in the adoption of digital innovations, such as the Internet of Things, Big Data, cloud computing, and digital platforms, as well as on information distribution processing in the digital age and how it affects financial market prices.

This paper analyzes the funding advantage of green bonds and the determinants of what is referred to as the “greenium” (the “green” premium). To this end, we first separate the greenium from a simultaneously prevailing liquidity premium in empirical yield spreads. For green German government bonds, we determine a greenium of 68.0 to 81.2 basis points. Further panel regressions provide evidence that the greenium benefits from environmental awareness (such as daily aggregated green bond volume, Google search volume, and CO2 allowance prices) and a higher yield to maturity. But it suffers from higher market uncertainty as measured by the marketwide credit spread.