Ronald Coase pioneered the transaction cost approach to the modern analysis of institutions, contracts, and property rights. We argue that core theory enhances Coase’s transaction cost approach by injecting considerations of coalition formation and stability into the analysis. Analysis of...

A ladder strategy calls for the maturities of the bonds in a portfolio to be spread out evenly with an equal amount invested in each maturity. There is wide acceptance of bond laddering by retail investors as an appropriate approach to constructing bond portfolios. However, the coverage of bond...

Firm entry and exit decisions are central to theories of market organization and the firm, and to the efficiency of a competitive market environment. Timely exit by “inefficient” firms is essential for the reallocation of economic resources from lower-value to higher-value users. If firm...

Firm entry and exit decisions are central to theories of market organization and the firm, and to the efficiency of a competitive market environment. Timely exit by “inefficient” firms is essential for the reallocation of economic resources from lower-value to higher-value users. If firm...

Do CEOs really matter for firm performance? And if they do, how does CEO human capital translate into firm value? We investigate these questions using a sample of firms with CEO turnover. We find that when a CEO with more general managerial human capital is matched with a firm relying more on...

How costly are systemic credit contractions? We examine this question using episodes of systemic banking crises across many countries and compare firm sales, profitability and investment during crisis, post-crisis, and pre-crisis periods. We find that credit contractions are costly for firms and...

This paper investigates the effect of a firm's organizational structure on its debt financing activities. Using corporate diversification strategy as an identification tool for organizational structure, we find that diversified firms have significantly lower loan rates than comparable focused...