<heading id="h1" level="1" implicit="yes" format="display">Abstract</heading>I investigate the efficiency of alternative hedging strategies of nonfinancial firms facing hedgeable price risk, unhedgeable quantity risk, and financial contracting costs in low-profit events. The analysis suggests that variance-minimizing hedging strategies are very close in economic...

Financial theory suggests that hedging can increase shareholder value in the presence of capital market imperfections, including direct and indirect costs of financial distress, costly external financing, and convex tax exposure. The influence of these costs, which are high when profits are low...

In addition to the ordinary corporate income tax, special purpose taxes are sometimes levied to extract abnormal profits arising from the use of natural resources. Such dual tax regimes exist in Norway for oil and hydropower, where the corresponding special purpose tax bases are unaffected by...

This paper demonstrates that electricity swap returns can be explained by a set of uncorrelated common and unique risk factors. Electricity swap returns differ from return data in other markets by a significant portion of overall risk being unaccounted for by common factors. It follows that...