In the presence of derivative markets, shareholders can choose their desired mix of cash-flows/votes and vary it through time. We find that the optimal security-voting structure is time varying. Even in the presence of derivatives, most of the time, shareholders optimally choose 1S1V. 1S1V turns...

We use a general equilibrium model to study how the market power and organizational form of banks interacts with the coordination problem arising from externalities in economic activity. If externalities are positive, bank market power severely reduces social welfare by exacerbating this...