Assuming a no arbitrage environment, this article analyses the role of the government in the context of company valuation when …rms follow di¤erent …nancial policies. For the two analyzed …nancial policies, the tax authority’s required returns and the value of tax payments are derived. Based on these results, we study the risk sharing e¤ects between equity owners and the government. It is shown...

This paper complements the ongoing empirical discussion surrounding participative budgeting by comparing its economic merits relative to a top-down budgeting alternative. We analyze a screening model of participative budgeting where the subordinate uses the budgeting mechanism to relay private information to his superior, in addition to a signaling model of top-down budgeting where the superior...

We study the problem of maximizing a stochastic monotone submodular function with respect to a matroid constraint. Our model can capture the effect of uncertainty in different problems, such as cascade effects in social networks, capital budgeting, sensor placement, etc. We study the adaptivity gap the ratio between the values of optimal adaptive and non-adaptive policies and show that it is eq...

& is called a knapsack constraint. The special case of the MKP01 with %*!) is the classical knapsack problem (KP01), whose usual statement is the following. Given a knapsack of capacity and objects, each being associated a profit (gain) and a volume occupation, one wants to select + ( +, and + not fixed) objects such that the total profit is maximized and the capacity of the knapsack is not exc...

We show how binary decision diagrams (BDDs) can be used to solve and obtain postoptimality analysis for linear and nonlinear integer programming problems with binary or general integer variables. The constraint set corresponds to a unique reduced BDD that represents all feasible or near-optimal solutions, and in which optimal solutions correspond to certain shortest paths. The BDD can be querie...

This paper focuses on the development of entrepreneurial orientation (EO) after a management buy-out (MBO) and on the role played by venture capital firms in enhancing EO. It presents results of two exploratory case studies of divisional buy-outs with regard to their EO and the areas where the venture capital firm (VC) has been of greatest help. We discuss their contribution to elements of the ...