In a tractable model of over-the-counter markets where each investor can arbitrarily distribute her search capacity across other investors, the holdings of an asset are endogenously concentrated among a subgroup of investors. Investors who are more likely to hold the asset search among those...

This study explores how stock liquidity shapes a firm’s cost behavior using the Tick Size Pilot Program (TSPP) as a natural experiment. We find that an exogeneous increase in the minimum tick size for small cap stocks leads to an increase in SG&A cost stickiness in these pilot firms,...

We examine daily short-selling activity and prices around reverse stock splits. Using a difference-in-difference approach with a matched sample of reverse splitting and non-reverse splitting stocks, we show that short selling increases in stocks that reverse split, relative to those that do not....

As financial markets transition from the London Interbank Offered Rate (Libor) to alternative benchmark rates, lenders in floating rate debt lose the hedging benefits provided by Libor because the alternative reference rates are credit-insensitive overnight rates. Comparing the yield spreads of...