This paper reports a new test of capital structure theories. It uses a filtering technique to identify large investment spikes. We find that the spikes are predominantly financed with debt by large firms and with new equity by small firms. In the process of financing large projects, firms move...

Until 1970, the New York Stock Exchange prohibited public incorporation of member firms. After the rules were relaxed to allow joint stock firm membership, investment-banking concerns organized as partnerships or closely-held private corporations went public in waves, with Goldman Sachs (1999)...

We study two platforms competing for members by investing in network quality.  Quality is complementary to the network size: the marginal utility generated by an additional member increases with the network's quality.  Platforms are imperfect substitutes: a share of the potential members are...

This paper analyses the survival of the complete cohort of more than 162,000 limited companies incorporated in Britain in 2001 over the subsequent five-year period.  For this purpose, we estimate firms' hazards of failure and survival functions using nonparametric and semi-parametric...

Sometimes shareholders are better off delegating to a CEO with different objectives than their own. A top manager motivated to share surpluses with workers can encourage union members to adopt efficient production methods. Bond covenants may constrain managers from acquiescing to union wage...

China has sought to improve enterprise performance not through privatisation as in other transition economies, but through corporatisation as means of improving corporate governance. Actual governance practices of corporatised Chinese firms are however seriously defective, characterized by...

Lower underpricing amongst venture-backed IPOs has been attributed to a certification role for venture capitalists. We argue that differences in underpricing per se are uninformative and possibly misleading when not controlling for differences in entrepreneurs` incentives to control...

Shipping goods internationally is risky and takes time.  To allocate risk and to finance the time gap between production and sale, a range of payment contracts is utilized.  I study the optimal choice between these payment contracts and their implications for trade.  The equilibrium contract...

Alpha is the amount by which the returns from a given asset exceed the returns from the wider market.  The standard way of estimating alpha is to correct for correlation with the market by regressing the asset's returns against the market returns over an extended period of time and then apply...

Traditional methods for analyzing portfolio returns often rely on multifactor risk assessment, and tests of significance are typically based on variants of the t-test.  This approach has serious limitations when analyzing the returns from dynamically traded portfolios that include derivative...