Valuation and the Volatility of Financing and Investment

all projects are funded. In the region of multiplicity, the move from a pooling (socially efficient) equilibrium to a valuation (socially inefficient) equilibrium involves many features of a financial crisis: prices decline (interest spreads rise); real investment declines; unsophisticated investors leave the market (flight to quality) and sophisticated investors make profits; trust declines and due diligence increases.

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Year of publication:	2010
Authors:	Parker, Jonathan A. ; Fishman, Michael
Institutions:	Society for Economic Dynamics - SED

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Extent:	application/pdf
Series:	2010 Meeting Papers.
Type of publication:	Book / Working Paper
Notes:	The text is part of a series 2010 SED Meeting Papers Number 1131
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011080751