We study the relationship between banks’ size and risk-taking in context of supranational banking supervision. Consistently with theoretical work on unions contrast to analyses emphasising incentives underpinned by too-big-to-fail effect, we find an inverse non-performing loan growth for a sample European banks. Evidence is provided that mechanism operates through enhanced organisational effici...

Abstract We analyze rights and public offerings when informed shareholders strategically choose to subscribe. Absent wealth constraints, achieve the full information outcome dominate offerings. When some are constrained, lead more dilution of their stakes lower payoffs, despite income from selling these rights. In both offerings, there is a trade-off between investment efficiency transfers amon...

We study how a firm’s decision to offer bonds of various maturities affects the portfolio allocations of institutional investors. We argue that because of lower information-collection costs, institutional investors tilt their portfolios towards firms that offer bonds of various maturities. We show that this translates into lower bond yields, both in the primary and in the secondary bond markets...

I present a model of venture capital contracting in which contracts that involve a mixture of both debt and equity are efficient and dominate pure-equity and pure-debt financing. The optimal contract balances the venture capitalist’s incentive to intervene in the project and the entrepreneur’s desire for control. JEL classification: G24, G32

Product recall data and information on stock price reactions to recalls are used estimate the value of reputation in a model which product quality is not contractible. A result defect that signals low effort. The triggers reduction firm’s value, then both rise steadily until its next occurs. We accounts for 8.3 percent firm welfare 26 first best level. policy intervention attains tax accompanie...

Business credit lags GDP growth by about one year. This contributes to high leverage during recessions and slow deleveraging. We show that a model in which firms use risky long-term debt replicates this adjustment of firm debt. In the model, slow-moving has important effects for real activity. High levels issued expansions are only gradually reduced recessions. generates an adverse feedback loo...

Abstract Certification by analysts on a FinTech platform that harnesses the “wisdom of crowds” is associated with successful initial coin offerings (ICOs). We show favorable ratings group diverse backgrounds positively predict fundraising success and long-run token performance. Analysts’ also help detect potential fraud ex ante. document have career concerns are incentivized to issue informativ...

This study investigates the role of retail pharmacy ownership in opioid epidemic. Using data prescription orders, we show that compared with chain pharmacies, independent pharmacies dispense 39.1 percent more opioids and 60.5 OxyContin. After an becomes a pharmacy, dispensing decreases. OxyContin reformulation, which reduced nonmedical demand but not legitimate medical demand, at least one-thir...

ABSTRACT We investigate the relationship between insider horizon and disclosure policy. First, we develop analyze a rational expectations model assuming insiders are able to commit Insiders with short prefer more willing bear costs of reduce information asymmetries among capital market participants. then empirically test our predictions in setting newly public firms where CEO is approaching ret...

Abstract This paper examines racial disparities in mortgage processing time prior to the global financial crisis. We find that Black borrowers are underrepresented and experience a longer than white among mortgages securitized by government-sponsored enterprises (GSEs). At same time, borrower overrepresented face similar privately (PLS) mortgages. Additionally, strongly associated with faster s...