The banks’ response to their changes in leverage ratios is examined and evaluated in this paper. This reaction can be interpreted as if the coefficient of total debts to equity (lev1) and total assets to equity (lev2) are positive as anticipated in the banking network of Iran. The paper uses data from 31 Iranian banks’ annual databases during the course of 2006-13 in order to estimate an empiri...

A common method of valuing the equity in leveraged transactions is the flows-toequity method whereby the free cash flow available to equity holders is discounted at the cost of equity. This method uses a standard definition of equity free cash flow, but the cost of equity varies over time as leverage varies. Various formulas can be used to calculate the time-varying cost of equity, most of whic...

Climate change would impact different countries differently, and different countries have different levels of development. Equity-weighted estimates of the (marginal) impact of greenhouse gas emissions reflect these differences. Equity-weighted estimates of the marginal damage cost of carbon dioxide emissions are substantially higher than estimates without equity-weights; equity-weights may als...

Senior executives typically delegate the responsibility for managing a firm's derivatives portfolio to in-house financial experts and the company's financial advisers. That's a strategic blunder, argues this Nobel laureate, because the inventiveness of modern financial markets makes it possible for companies to double or even triple their capacity to invest in their strategic assets and compete...

BACKGROUND One of the most unexpected outcomes arising from the efforts towards maternal and child mortality reduction is that all too often the objective success has been coupled with increased inequity in the population. The aim of this study is to analyze the determinants of the complex interplay between cost-effectiveness and equity and suggest strategies that will promote an impact on mort...

If decision costs lead agents to update consumption every D periods, then econometricians will find an anomalously low correlation between equity returns and consumption growth (Lynch 1996). We analytically characterize the dynamic properties of an economy composed of consumers who have such delayed updating. In our setting, an econometrician using an Euler equation procedure would infer a coef...

We develop a dynamic structural model to examine the e¤ects of di¤ering beliefs of the manager and outsider investors regarding the pro…tability of a …rm’s projects and managershareholder agency con‡icts on its capital structure. The manager receives dynamic incentives through explicit contracts with shareholders whose implementation through …nancial securities leads to a dynamic capital struct...