We examine underwriting fees for repeat issuers of new securities to determine the relation between loyalty to an underwriting bank and the fees charged. For a sample of offers over the 1975-2001 period, we find that loyalty is associated with lower fees for common stock offers, consistent with...

We analyze cross-sectional and time-series patterns in the relationship between firms that are frequent issuers of new securities and their underwriters over the 1970-1996 period. In particular, we focus on the relation between fees charged for underwriting services and the closeness of the...

This paper provides a model that explains the structure of mutual funds. Specifically, the paper explains why funds structure as open- or closed-end funds, and why some open-end funds charge loads. In our model fund managers generate earn excess returns that, on the margin, are increasing in...

This paper provides a model that explains the structure of mutual funds. Specifically, the paper explains why funds structure as open- or closed-end funds, and why some open-end funds charge loads. In our model fund managers generate earn excess returns that, on the margin, are increasing in...

We investigate whether the timing of equity sales to exploit market overvaluation may account for the reported poor post-offer stock performance of firms issuing equity. We posit that rights offers, targeted to a firm's current shareholders, are less likely to be timed to exploit overvaluation....

Recent literature has been largely negative in its assessment of value effects of corporate diversification. Does value maximization nevertheless play an important role in the conglomeration process? Drawing upon value maximization theories, we identify industry conditions that make a...

Recent literature has been largely negative in its assessment of corporate diversification. Diversified firms have been regarded as destructive of firm value, prone to agency problems and divisional rent-seeking. The empirical finding that multi-division firms tend to trade at a 'discount,' or...

We study the offer choice between rights and firm commitments for a sample of industrial firms issuing equity in the 1930's and 1940's. Unlike existing studies, our sample is drawn from a time period when rights were as common an offer method for industrial firms as were firm commitments. This...

Prior literature argues that stock-for-stock mergers are often financed by overvalued stock. How do a target's institutional owners trade when faced with a stock-financed bid, particularly one from an acquirer more likely to be overvalued? If institutional owners perceive the acquirer's stock as...