Using a dataset of both public and private firm connections, I find a 1.5-percentage-point increase in long-term book leverage of a firm leads to a 10-percentage-point increase in the probability it adds an additional supplier. At the same time, I do not find significant increases in sales or...

We examine firm and industry characteristics associated with outsourcing and the relation between outsourcing and capital structure using a unique database of purchase contracts for a measure of firm outsourcing. We document firm, industry, and supplier characteristics that are significantly...

This paper studies the relationship between firm leverage and supplier market structure by examining their joint impacts on bargaining and relation-specific investments. We find that firm leverage decreases with the degree of competition among suppliers. Specifically, leverage decreases with the...

This paper examines the relationship between a firm's leverage and that of its customers. We find that a firm's leverage is positively associated with its customer's leverage. We show that the positive leverage relationship is not driven by unobservable local and industry-specific shocks. To...

We examine the association between customer concentration and capital structure adjustment speed using a sample of listed firms in the U.S from 1977 to 2020. We find that the customer-concentrated firms have a lower speed of leverage adjustment. The decomposition of customer types identifies...

I explain the standard carried interest contract as a mechanism to induce incentive compatible fund leverage while also satisfying LP return objectives. Fee, leverage and target return data from private equity real estate (PERE) funds are used to calibrate the model. Steps in the modeling...

Suppliers socially connected to major customers with relation-specific investments have higher leverage ratios compared to unconnected suppliers. The presence of connections partially reduces supplier underleverage observed in supplier-customer relationships with relation-specific investments....

I develop a dynamic model of financing decisions and optimal debt maturity choice in which creditors face adverse selection and learn about the firm's quality from news. In equilibrium, shareholders may choose to postpone debt issuance to reduce adverse selection and improve the pricing of newly...

This essay surveys the body of research that asks how the efficiency of corporate investment is influenced by problems of asymmetric information and agency. I organize the material around two basic questions. First, does the external capital market channel the right amount of money to each firm?...