We develop a dynamic investment options framework with optimal capital structure and analyze the effect of debt maturity. We find that in the absence of financing constraints short-term debt maximizes firm value. In contrast with most literature results, in the absence of constraints, higher...

Our research uses the environmental pillar of ESG as a proxy for environmental corporate social responsibility. We examine the performance of environmentally clustered portfolios, by using simple quantitative investment strategies with optimum asset rotation. A post-hoc, sample-split analysis...

We develop and empirically test a trade-off model for the analysis of leverage changes in mergers and acquisitions. This study extends prior findings of a post-merger increase in leverage for the acquiring firm by linking this leverage increase to merging firms that are less correlated, create...

In this paper we study the morphogenesis of an institution when local social interactions are taken into account. The structure we obtain has characteristics of self-organized criticality. After a transient period the system self-organizes into a configuration which is compatible with a high...

The effects of four environmental policy options for the reduction of pollution emissions, i.e. taxes, emission standards, auctioned permits and freely allocated permits, are analyzed. The setup is a real option model where the amount of emissions is determined by solving the firm's profit...

No question has more intrigued the minds of scholars of economic thought throughout history than that of the nature and meaning of time. The articles in this insightful collection attempt to provide satisfactory answers to fundamental issues on the use of time in economic theory. These volumes...

A problem of corporate liquidation policy is studied in a real option setting incorporating taxation, risky debt and conflict of interest between equity holders and debt holders or equity holders and manager. The critical liquidation threshold is derived as a function of four tax schedules and...

This paper contributes to the debate on alternative corporate tax schemes, employing a rigorous real option methodology which has never been used to study both liquidation policy and taxation. Different tax systems are considered, according to whether the tax regime is progressive or flat and...