This paper characterizes the relationship between entrepreneurial wealth and aggregate investment under adverse … analysis: (i) pooling equilibria, in which investment is independent of entrepreneurial wealth, are more likely to arise when … entrepreneurial wealth is relatively low; (ii) separating equilibria, in which investment is increasing in entrepreneurial wealth, are …

spite of the threat of entry by inactive banks. Moreover, an increase in the number of active banks increases credit risk …

interest of Credit Rating Agencies (CRAs). We model both the CRA conflict of understating credit risk to attract more business … lower. To the extent that in booms the fraction of naive investors is higher, and the reputation risk for CRAs of getting … caught understating credit risk is lower, our model predicts that CRAs are more likely to understate credit risk in booms …

understating credit risk to attract more business; 2) the ability of issuers to purchase only the most favorable ratings; and 3 …

excessive risk. We propose a solution to this problem, showing how insurance against systemic shocks can be provided without … importantly establishing a Systemic Risk Authority endowed with special resolution powers, including the control of bankers …

We formulate a knowlegde--based model of direct investment through mergers and acquisitions. M&As are realized to …'s bargaining power increases the takeover fee, but does not influence the investment decision. We characterize losers and winners … from multinationalization, and show that foreign investment stimulates research but could result in a synergy trap reducing …