We consider a setting in which potential buyers of an indivisible item have private and heterogeneous valuation and cost of capital. The valuation and cost of capital can be correlated with each other, but they are independent across buyers. In such a setting, a buyer's utility for the item is...

This paper examines the effects of idiosyncratic accounting information on a firm's cost of capital. By embedding a moral hazard problem into a multi‐firm asset pricing model, I show that moral hazard distorts the sharing of idiosyncratic risk but does not affect the sharing of systematic risk...

This paper uses a sample of Chinese firms to examine the impact of corporate opacity on the relationship between family control and firms' cost of debt. We find that family control is associated with a lower cost of debt on average, and a negative impact exists mainly in firms with relatively...