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Follow the Money: Methods for Identifying Consumption and Investment Responses to a Liquidity Shock
Karlan, Dean S.; Osman, Adam; Zinman, Jonathan - C.E.P.R. Discussion Papers - 2013
theory, practice, and policy. Using seven different methods on microenterprise loan applicants, we find striking results …
Persistent link: https://www.econbiz.de/10011083720
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The Misfortune of Non-financial Firms in a Financial Crisis: Disentangling Finance and Demand Shocks
Tong, Hui; Wei, Shang-Jin - C.E.P.R. Discussion Papers - 2009
If a non-financial firm does not do well in a financial crisis, it could be due to either a contraction of demand for its output or a contraction of supply of external finance. We propose a framework to assess the relative importance of the two shocks, making use of a measure of a firm's...
Persistent link: https://www.econbiz.de/10005661997
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Search Unemployment with Advance Notice
Garibaldi, Pietro - C.E.P.R. Discussion Papers - 1999
This paper proposes and solves a search unemployment model in which job separation requires mandatory notice. When jobs are subject to idiosyncratic uncertainty, firms would issue advance notice even with good business conditions. We show that such precautionary policy is not pursued if it...
Persistent link: https://www.econbiz.de/10005497907
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Fiscal Prerequisites for a Viable Managed Exchange Rate Regime: A Non-Technical Eclectic Introduction
Buiter, Willem H. - C.E.P.R. Discussion Papers - 1986
omission of government bonds and borrowing in his analysis. There is not yet any "deep structural" theory justifying the … collapsing exchange rate regimes. In the absence of such a theory of "international liquidity", one cannot construct a …
Persistent link: https://www.econbiz.de/10005666524
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A Small Corner of Intertemporal Public Finance - New Developments in Monetary Economics: Two Ghosts, Two Eccentricities, a Fallacy, a Mirage and a Mythos
Buiter, Willem H. - C.E.P.R. Discussion Papers - 2004
Monetary theory and policy are part of intertemporal public finance. This Paper reviews some interesting recent … the so-called Fiscal Theory of the Price Level, a logically inconsistent theory of the link between the government budget …
Persistent link: https://www.econbiz.de/10005123549
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Creditor Rights and Debt Allocation within Multinationals
Akbel, Basak; Schnitzer, Monika - C.E.P.R. Discussion Papers - 2010
We analyze the optimal debt structure of multinational corporations choosing between centralized or decentralized borrowing. We identify how this choice is affected by creditor rights and bankruptcy costs, taking into account managerial incentives and coinsurance considerations. We find that...
Persistent link: https://www.econbiz.de/10008466341
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Disagreement and Flexibility: A Theory of Optimal Security Issuance and Capital Structure
Boot, Arnoud W A; Thakor, Anjan - C.E.P.R. Discussion Papers - 2003
strongest implication of this theory of capital structure evolution is that optimal capital structure is essentially dynamic … prices are low. The theory explains many stylized facts that fly in the face of existing capital structure theories and also … generates new testable predictions. Moreover, the theory can rationalize the use of debt in the absence of taxes, agency costs …
Persistent link: https://www.econbiz.de/10005666532
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Limits of Limits of Arbitrage: Theory and Evidence
Hombert, Johan; Thesmar, David - C.E.P.R. Discussion Papers - 2009
We present a model where arbitrageurs operate on an asset market that can be hit by information shocks. Before entering the market, arbitrageurs are allowed to optimize their capital structure, in order to take advantage of potential underpricing. We find that, at equilibrium, some arbitrageurs...
Persistent link: https://www.econbiz.de/10005666728
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Credit Risk and Dynamic Capital Structure Choice
Dangl, Thomas; Zechner, Josef - C.E.P.R. Discussion Papers - 2003
This Paper analyses the effect of dynamic capital structure adjustments on credit risk. Firms may optimally adjust their leverage in response to stochastic changes in firm value. It is shown that capital structure dynamics lower optimal initial leverage ratios but increase both fair credit...
Persistent link: https://www.econbiz.de/10005123682
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Liquidity Risk, Leverage and Long-Run IPO Returns
Eckbo, B Espen; Norli, Øyvind - C.E.P.R. Discussion Papers - 2005
We examine the risk-return characteristics of a rolling portfolio investment strategy where more than six thousand Nasdaq initial public offering (IPO) stocks are bought and held for up to five years. The average long-run portfolio return is low, but IPO stocks appear as ‘longshots’, as...
Persistent link: https://www.econbiz.de/10005124287