We examine how local political corruption affects corporate investment. We find firms in corrupted states produce significantly less investment. The effect of political corruption on investment is more pronounced in firms with higher investment friction, higher political visibility, and poor...

This paper studies the capital allocation decisions of firms that are comparable except for ownership under a unique setting using investment level data. We find allocative inefficiency across ownership to be exacerbated under policy distortions through subsidized credits targeted at state-owned...

Corporate leverage responds differently to employees' rights in bankruptcy depending on whether it is driven by strategic concerns in wage bargaining or by credit constraints. Using novel data on employees' rights in bankruptcy, we estimate their impact on leverage, exploiting time-series,...

If unemployment insurance is more generous, workers should demand less implicit insurance from their employers: firm- and government-provided insurance should be substitutes. Using a firm-level international panel dataset, we investigate this hypothesis exploiting cross-country and time-series...

We explore a long standing prediction in the international business literature that managers' subjective perceptions of political risk – not just the level of risk – are important for how firms manage political risk. The importance attributed to political risk by corporate executives has...

This essay, based on the author's presentation last September to the annual meeting of the North American Securities Administration Association (NASAA), addresses several issues related to Rule 506, the most widely-used of the SEC's transactional exemptions from federal registration of...

Building on the important study by Beck, Demirguc-Kunt and Maksimovic (2005, Journal of Finance), we examine how government intervention in firms' decision-making is related to their investment and sales growth. Using the unique World Bank dataset (WBES) covering 6,500 firms in 70 countries, we...

We exploit pension funding relief enacted in 2012 to estimate the effects of a positive shock to internal liquidity on market prices and investment. Measuring unexpected increases in internal liquidity using a priori expected pension contributions disclosed under FAS132R, we report positive...

We study the effects of firm-level exposure to an epidemic disease on corporate cash holdings amongst U.S firms. Using a text-based measure of firm-level exposure to epidemic diseases and difference-in-difference estimation strategy, we document a positive relationship between the onset of an...

Over the next decade, governments around the world will invest massively in new projects, aiming at closing the long-identified infrastructure gap, to sustain economic and social development, and to recover from recent adverse shocks. This paper examines this topic from two perspectives: (i) how...