We develop a model of a firm in financial distress. Distress can be mitigated by filing for bankruptcy, which is costly, or preempted by restructuring, which is impeded by a collective action problem. We find that bankruptcy and restructuring are complements, not substitutes: Reducing bankruptcy...

Shareholder and public dissatisfaction with executive compensation has led to calls for an annual shareholder advisory vote on a firm's compensation pratices and policies, so-called "say on pay." Proposed federal legislation would mandate "say on pay" generally for US public companies. This...

This paper argues that while financial markets have become transnational, their governance structures have remained national at the core: Fiscal responsibility for crises is ultimately born by the nation state where the crisis occurred – whether or not it bears any responsibility for...

Over half of all small businesses reorganizing under Chapter 11 of the U.S. Bankruptcy Code are ultimately liquidated. Little is known about this shutdown decision and about the factors that increase or reduce the amount of time a firm spends in bankruptcy. It is widely suspected, however, that...

Structural reform, the “third arrow” of the Abe administration's policy for revitalizing the Japanese economy, centers on corporate governance reform. In recent years, Japan has adopted a Stewardship Code in the hopes of invigorating institutional investor engagement, a Corporate Governance...

In each of the three largest economies with dispersed ownership of public companies - the United States, the United Kingdom, and Japan - hostile takeovers emerged under a common set of circumstances. Yet the national regulatory responses to these new market developments diverged substantially....

This letter on Money Market Fund Reform was submitted in response to the Financial Stability Oversight Council's proposals of November 2012. I endorse the so-called “Minimum Balance at Risk Proposal,” in which sponsors would contribute or raise capital of one percent of a MMF's assets while...

Unlike the failure of a non-financial firm, the failure of a systemically important financial firm will reduce the value of a diversified shareholder portfolio because of an increased level of systemic risk. Thus diversified shareholders of a financial firm generally internalize systemic risk...