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Persistent link: https://www.econbiz.de/10005774196
There is a wide variation in the structure of financial systems in different countries. We compare two idealized polar extremes. In one, which we refer to as the "German model," banks and other intermediaries predominate. In the other, which we refer to as the "U.S. model," financial markets...
Persistent link: https://www.econbiz.de/10005618219
How should new securities be designed? Traditional theories have little to say on this: the literature on capital structure and general equilibrium theories with incomplete markets take the securities firms issue as exogenous. This paper explicitly incorporates the transaction costs of issuing...
Persistent link: https://www.econbiz.de/10005656894
The returns of assets that are traded on financial markets are more volatile than the returns offered by intermediaries such as banks and insurance companies. This suggests that individual investors are exposed to more risk in countries which rely heavily on financial markets. In the absence of...
Persistent link: https://www.econbiz.de/10005656998
The returns of assets that are traded on financial markets are more volatile than the returns offered by intermediaries such as banks and insurance companies. This suggests that individual investors are exposed to more risk in countries which rely heavily on financial markets. In the absence of...
Persistent link: https://www.econbiz.de/10005657044
Persistent link: https://www.econbiz.de/10005657088
Prior to the Securities Exchange Act of 1934, manipulation of stock prices was an issue of great concern. The Act reduced the possibilities for manipulation by, among other things, making it illegal for a manager to sell short his firm’s shares or for false information about a firm to be...
Persistent link: https://www.econbiz.de/10005657131
Traditional theories of asset pricing assume there is a complete market participation, in the sense that all investors participate in all markets. In that case, preferences shocks typically have only a small effect on asset prices and are not an important determinant of asset price volatility....
Persistent link: https://www.econbiz.de/10005618272
Persistent link: https://www.econbiz.de/10005774211
There is some empirical evidence that high tax bracket investors hold the equity of unlevered firms while law tax bracket investors hold levered firms. It has been suggested that an extension of the Miller model can provide a theory which is consistent with this observation. However, it has been...
Persistent link: https://www.econbiz.de/10005618242