“…Informational problems could arise, he argued, because management cannot credibly communicate news about the firm's future prospects. The newly named 'bonding hypothesis' has received much positive empirical support in subsequent work by Reese and Weisbach (2002), Doidge (2004), Doidge et al (2004Doidge et al ( , 2009b, and Doidge et al (2009a), among many others, but it has also received its share of criticism (see, e.g., King and Segal, 2009;Licht, 2001aLicht, ,b, 2003Litvak, 2009;Siegel, 2005). The thrust of Stulz's argument was that firms facing such problems could alleviate the concerns of their public shareholders by credibly 'bonding' the firm to a tougher institutional environment than at home, where there would be better monitoring by capital market agents such as investment bankers, research analysts, and active institutional investors, as well as more stringent corporate governance, transparency, and legal and regulatory protections.…”