How does uncertainty affect the costs of raising finance in the bond market and via bank loans? Empirically, this paper … finds that heightened uncertainty is accompanied by an increase in corporate bond yields and a decrease in bank lending … the value of the lending relationship and lowers the lending rate. Bond investors demand compensation for the increased …

−specific CoCo bond market concentration. Buyers are defined as having a preference for CoCo bonds if their return−to−risk is higher …This paper estimates the preference scores of CoCo bond buyers and sellers by running multinomial logistic regressions … taking into account both bond and issuing banks' characteristics; it also provides evidence on the role of country …

This paper studies the impact of financial sector size and leverage on the business cycle and risk-free rates dynamics …. We develop a general equilibrium model of a productive economy where financial intermediaries provide costly risk … cycle fluctuations, while providing households with a risk-free asset whose real return is pro-cyclical and possibly …

first-order approximated solution built by perturbation methods accounts for risk. We show that risk matters economically in … a real business cycle (RBC) model with habit formation and capital adjustment costs and that neglecting risk leads to …

Economic theory suggests that the deterrence of deviant behavior is driven by a combination of severity and certainty …

In this paper we use an experiment to compare a theory of risk aversion and a theory of spite as an explanation for … overbidding in auctions. As a workhorse we use the second-price all-pay and the first-price winner-pay auction. Both risk and … spite can be used to rationalize deviations from risk neutral equilibrium bids in auctions. We exploit that equilibrium …

hitting a threshold, as well as a set of risk-modified optimality conditions for overall wealth management, as long as no …