Using data from publicly traded South Korean corporations for the period 1980-94, this paper finds evidence that increases in financial liberalization that accompanied the more general process of financial globalization have significantly reduced the maturity structure of corporate debt contracts, thus lending partial empirical support to the idea that financial liberalization can be well descr...

We analyze the effect of an exogenous shock to the Italian mortgage market and we show that most households do not act rationally when it comes to take mortgage-refinancing decisions. Thanks to a new legislation passed in 2007, borrowers have been allowed to refinance their loans at no cost. This reform— along with the drop of interest rates occurred between 2008 and 2009—has produced a unique ...

Using Japanese firms that went public during the period 1998-2006, we find that independent venture capitalist-backed IPO firms are significantly younger and smaller than IPO companies backed by venture capital firms that are subsidiaries of financial institutions. Independent venture capitalists tend to make firms go public on stock exchanges with less strict listing requirements. Importantly,...

This paper examines how control and ownership structure affect share repurchases in an emerging market where controlling families derive large private benefits. Whereas firms with concentrated ownership often pay cash dividends, firms with weak control rights often repurchase shares. The magnitude of repurchase increases with weak control rights, but decreases with strong foreign ownership. The...

This study examines the effect of corporate liquidity and investor protection on the relation between financial distress and equity returns using a European sample over the 2002-2016 period. The results show that returns are hump-shaped and decreasing for increasing default risk. This can be rationalized by corporate liquidity indicating that higher cash holdings decrease liquidity risk. Moreov...

Empirical evidence suggests that the voting premium in the Korean securities market is strongly related to the structure of corporate ownership. We find that the premium attached to voting stock is positively and significantly associated with the control value of a block of shares held by minority shareholders. We also find that the premium is negatively related to both the fraction of shares t...

We construct a Risk Management Index (RMI) to measure the strength and independence of the risk management function at bank holding companies (BHCs). U.S. BHCs with higher RMI before the onset of the financial crisis have lower tail risk, lower non-performing loans, and better operating and stock return performance during the financial crisis years. Over the period 1995 to 2010, BHCs with a hig...

We study how organizational complexity affects managerial behavior, breaking it down into vertical hierarchy and degree of specialization. We exploit a novel dataset on the organizational structure of the US asset management industry. We show that more hierarchical structures reduce the incentive to collect soft information by investing less in closely-located firms. This reduces portfolio conc...

We provide a model for a futures clearinghouse to use for setting optimal levels of clearing margin, capital and price limits, which minimizes the costs to clearing firms and simultaneously protects the clearinghouse from default by clearing firms. We show how to estimate the capital requirement, which supports the clearinghouse s residual default risk that is not covered by the clearing margin...

Marital status can both reflect and affect individual preferences. We explore the impact of marriage on corporate CEOs, and find that firms run by single CEOs exhibit higher stock return volatility, pursue more aggressive investment policies, and do not respond to changes in idiosyncratic risk. These effects are weaker for older CEOs. Our findings continue to hold when we use variation in divor...