This paper explores the relationship between founding family ownership and stock market returns. Using the entire population of non-financial firms listed on the Swiss stock market for 2003–2013, we find that the stock returns of family firms are significantly higher than those of non-family...

There are noticeable differences between the roles that various forms of credit financing play in family businesses and in other businesses. Family businesses take out more often bank loans specifically to finance investments and innovations, and they particularly often resort to the short-term...

The corporate governance literature has shown that self-interested controlling owners tend to divert corporate resources for private benefits at the expense of other shareholders. Such behavior leads the controlling owners to prefer long maturity debt to short maturity debt, to avoid frequent...

This research investigates the relationship between corporate block ownership and firm financial leverage. Corporate blockholders, which are nonfinancial firms who hold more than five percent equity in a target industrial firm, can affect the target firm's policies through their business...

This paper examines the use of governance and incentive mechanisms beyond loan contract provisions that borrowers use to reduce contracting costs with lenders. We show that as the strength of the relationship between a borrower and a lender intensifies over time, borrowing firms are more likely...

We allow the preference of a political majority to determine boththe corporate governance structure and the division of profits betweenhuman and financial capital. In a democratic society where financialwealth is concentrated, a political majority may prefer to restraingovernance by dispersed...

Debt ownership by equity-holding managers aligns their incentives more closely with those of creditors, thereby reducing agency costs of debt. We test this hypothesis by examining how terms of bank loans are related to executive pension and deferred compensation, i.e., inside debt held by...

We investigate how transient institutional ownership influences the level and value of cash holdings. We show that transient institutional ownership has a positive effect on cash holdings, and this linkage is more pronounced when stock and credit market conditions are less favorable. Using a...

We examine how ownership by couples affects risk taking in family firms. We find that firms co-owned by couples exhibit significantly lower stock return volatility. This result is robust to a difference-in-differences approach based on a smaller sample and an instrumental variable approach....

I explore the effect of the threat posed by low-cost competitors on debt structure in the airline industry. I use the route network expansion of low-cost airlines to identify routes where the probability of future entry increase dramatically. I find that when a large portion of their market is...