This paper examines the effect of the Dodd-Frank Act (“Dodd-Frank”) on the profits and risk-taking of the hedge fund industry. Dodd-Frank subjects most hedge funds to government inspections, requires them to register with the Securities and Exchange Commission (“SEC”), and imposes a...

This Article is the first to analyze an unexplored but critical change in how modern banks are governed: the rise of lawyers as bank directors. That rise has been precipitous, raising the question of why lawyer-directors now sit on most bank boards. Using novel empirical evidence, we show that...

Uncertainty about manager skill and diversification constraints are hallmarks of investing in alternative assets. This paper quantifies the utility losses to private equity investors arising from these frictions. When calibrated to the data on institutional allocations to private equity and...

Models of seasoned equity offerings (SEOs) such as Myers and Majluf (1984) assume that all investors in the economy pay immediate attention to SEO announcements and the pricing of SEOs. In this paper, we analyze, theoretically and empirically, the implications of only a fraction of investors in...

While previous papers have characterized various features of the financial contracts between entrepreneurs and venture capitalists, little is known about how the equity contracts evolve over the life of new ventures. Using the novel data set containing financial contract terms applying to...

We empirically distinguish between three possible roles of venture backing in IPOs: certification, where venture-backed IPOs are priced closer to intrinsic firm value than non-venture backed IPOs due to venture capitalists' concern for their reputation; screening and monitoring, where VCs are...

AlpInvest was created in 1999 as a joint venture between Dutch pension funds ABP and PGGM to create a strong platform for their private equity investments This case study examines the strategic rationale for setting up this private equity joint venture, and evaluates the pros and cons. We...

Growth expectations and institutional settings in Central Eastern Europe are considered favorable for the establishment of a vibrant venture capital and private equity market. Despite this, there is a lack of risk capital. We examine the obstacles to institutional investments in the region...

There is an extensive literature documenting a mutual fund performance deficit, whereby a large number of mutual funds underperform the market index. One possible cause is conflicts of interest between mutual funds and investors. I explore the consequences of a new regulation prohibiting funds...

After the 1980's, LBO projects have dramatically increased on the American and European markets. Despite the high level of debt, they provide significant gains and they improve the productivity of the acquired firms. First, we describe the evolution of this industry on these markets, we focus...