Sofia Eleftheriou

RENEWABLE ENERGY CONSUMPTION, POLITICAL AND INSTITUTIONAL FACTORS: EVIDENCE FROM A GROUP OF EUROPEAN, ASIAN AND LATIN AMERICAN COUNTRIES

This paper explores the dynamic relationships between renewable energy consumption and a number of institutional and political factors for a group of countries from Europe, Asia and Latin America spanning the period 1995–2011. The paper employs the methodology of long and short-run panel causality approach as well as the methodology of the panel Error Correction model. The empirical findings provide strong evidence that, after controlling the economic environment, both political and institutional factors exert a strong and statistically significant effect on renewable energy consumption. These findings are expected to have serious implications for policies related to clean energy.

Credit Risk: The Role of Market and Accounting Information-Evidence from U.S. Firms and a FAVAR Model

Abstract This paper examines the capability of both accounting and market information in explaining the cross-sectional variation of five-year credit default swap spreads. The paper proposes a panel FAVAR methodological approach to combine the additional predictions from a long list of accounting and market fundamental variables, while controlling the macroeconomic environment of the firms. A comprehensive analysis based on 171 U.S. manufacturing spanning the period 2003 (January)-2011 (October) shows that impulse response functions and variance decompositions support the dominance of the market environment over the accounting environment in providing information to the credit markets, while they display a minor role for the macroeconomic variables employed.

Credit risk: the role of market, accounting and macroeconomic information - evidence from US firms and a FAVAR model

This paper examines the role of accounting, market and macroeconomic information in explaining the cross-sectional variation of credit default swap spreads. The study proposes a panel FAVAR methodological approach to combine the additional predictions from a long list of accounting, market and macroeconomic fundamental variables. A comprehensive analysis based on 171 US manufacturing firms and spanning the period 2003-2011, shows that variance decompositions support the dominance of the market environment over the accounting and the macroeconomic environments in providing information to the credit markets.

Accounting information and excess stock returns: the role of the cost of capital – new evidence from US firm-level data

The goal of this article is to investigate the impact of accounting information on the cost of capital as well as how the latter influences excess returns. The analysis has certain novelties: first, it extends prior works by investigating how certain components of accounting information affect stock returns through its direct effect on the cost of capital by incorporating influential components of accounting information; second, it makes use of a sample of 330 US manufacturing firms spanning the period 1990Q1 to 2009Q2, while it makes use, for the first time in this literature, of the methodology of panel cointegration. The empirical findings display that accounting information affects directly the firms cost of capital. This, in turn, tends to exert a negative effect on the firms excess stock returns, an empirical documentation not captured in case researchers attempt to directly link the cost of capital and excess stock returns.