A Managed Distribution Policy (MDP), where investments might be partially liquidated to increase investors' cash flows, can lower the value of manager's claim on asset payoffs. This is a direct transfer of wealth from the management to the shareholders, and might be adopted by managers to deter...

This survey deals with the literature on closed-end funds (CEFs) in general and theories of discounts in particular. New theories have emerged over the past 10 years that reveal CEFs to be an important and efficient organizational device. Among the topics reviewed are liquidity transformation,...

The discount on closed-end funds is widely accepted as proof of investor irrationality. We show,however, that a parsimonious rational model can generate a discount that exhibits many of the characteristics observed in practice. The only required features of the model are that managers have...

The discount on closed-end funds is widely accepted as proof of investor irrationality. We show,however, that a parsimonious rational model can generate a discount that exhibits many of the characteristics observed in practice. The only required features of the model are that managers have...