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Acharya, Viral V.; Gale, Douglas; Yorulmazer, Tanju - National Bureau of Economic Research (NBER) - 2010

The crisis of 2007-09 has been characterized by a sudden freeze in the market for short-term, secured borrowing. We present a model that can explain a sudden collapse in the amount that can be borrowed against finitely-lived assets with little credit risk. The borrowing in this model takes the...

Persistent link: https://www.econbiz.de/10008601707

Who Makes Acquisitions? CEO Overconfidence and the Market's Reaction

Malmendier, Ulrike; Tate, Geoffrey - National Bureau of Economic Research (NBER) - 2004

Overconfident CEOs over-estimate their ability to generate returns. Thus, on the margin, they undertake mergers that destroy value. They also perceive outside finance to be over-priced. We classify CEOs as overconfident when, despite their under-diversification, they hold options on company...

Persistent link: https://www.econbiz.de/10005034329

Venture Capitalists As Principals: Contracting, Screening, and Monitoring

Stromberg, Per; Kaplan, Steven N. - National Bureau of Economic Research (NBER) - 2001

Theoretical work on the principal-agent problem in financial contracting focuses on the conflicts of interest between an agent / entrepreneur with a venture that needs financing, and a principal / investor providing funds for the venture. Theory has identified three primary ways that the...

Persistent link: https://www.econbiz.de/10005774685

Private Equity and Long-Run Investment: The Case of Innovation

Lerner, Josh; Stromberg, Per; Sørensen, Morten - National Bureau of Economic Research (NBER) - 2008

A long-standing controversy is whether LBOs relieve managers from short-term pressures from public shareholders, or whether LBO funds themselves are driven by short-term profit motives and sacrifice long-term growth to boost short-term performance. We investigate 495 transactions with a focus on...

Persistent link: https://www.econbiz.de/10005774804

The Variability of IPO Initial Returns

Schwert, G. William; Lowry, Michelle; Officer, Micah S. - National Bureau of Economic Research (NBER) - 2006

The monthly volatility of IPO initial returns is substantial, fluctuates dramatically over time, and is considerably … larger during "hot" IPO markets. Consistent with IPO theory, the volatility of initial returns is higher among firms whose … the efficacy of the traditional firm commitment underwritten IPO process. One implication of our results is that alternate …

Persistent link: https://www.econbiz.de/10005829089

Characteristics, Contracts, and Actions: Evidence from Venture Capitalist Analyses

Stromberg, Per; Kaplan, Steven N. - National Bureau of Economic Research (NBER) - 2002

We study the investment analyses of 67 portfolio investments by 11 venture capital (VC) firms. VCs consider the attractiveness and risks of the business, management, and deal terms as well as expected post-investment monitoring. We then consider the relation of the analyses to the contractual...

Persistent link: https://www.econbiz.de/10005829908

Neoclassical Factors

Zhang, Lu; Chen, Long - National Bureau of Economic Research (NBER) - 2007

Building on neoclassical reasoning, we propose a new multi-factor model that consists of the market factor and factor mimicking portfolios based on investment and productivity. The neo- classical three-factor model outperforms traditional factor models in explaining the average returns across...

Persistent link: https://www.econbiz.de/10005830265

Why Do IPO Auctions Fail?

Jagannathan, Ravi; Sherman, Ann - National Bureau of Economic Research (NBER) - 2006

We document a somewhat surprising regularity: of the many countries that have used IPO auctions, virtually all have …

Persistent link: https://www.econbiz.de/10005830465

Collateral Pricing

Benmelech, Efraim; Bergman, Nittai K. - National Bureau of Economic Research (NBER) - 2008

We examine how collateral affects the cost of debt capital. Theories based on borrower moral hazard and limited pledgeable income predict that collateral increases the availability of credit and reduces its price. Testing these theories is complicated by the very selection problem which they...

Persistent link: https://www.econbiz.de/10005088753

How Do Legal Differences and Learning Affect Financial Contracts?

Stromberg, Per; Kaplan, Steven N.; Martel, Frederic - National Bureau of Economic Research (NBER) - 2003

We analyze venture capital (VC) investments in twenty-three non-U.S. countries and compare them to VC investments in the U.S. We describe how the contracts allocate cash flow, board, liquidation, and other control rights. In univariate analyses, contracts differ across legal regimes. At the same...

Persistent link: https://www.econbiz.de/10005103373