This study explores the market response to achieving analyst earnings expectations, distinguishing between expectations achieved through earnings forecast guidance and earnings management. We consider three earnings management tools: real earnings management, working capital accruals management,...

Dye [J Account Res 23 (1985) 123] showed that the optimal disclosure policy, when a manager is randomly endowed with perfect private information, is upper tailed, i.e., the manager only discloses firm value above an appropriate cutoff level. We interpret this strategically as an optimal exercise...

Certain parts of the international tax system are largely unexplored from a structural perspective. One prominent example is the asymmetric tax treaty network, i.e. the network that consists of bilateral tax treaties concluded between developed and emerging countries on the basis of the OECD...

The philanthropic venture capital investment model is a financing option available for social enterprises. Its value proposition combines the maximization of social impact with the ability of backed organizations to become sustainable, accomplished through the provision of capital and...

The classical doctrine of the Lender of Last Resort, elaborated by Thornton (1802) and Bagehot (1873), asserts that the Central Bank should lend to “illiquid but solvent” banks under certain conditions. Several authors have argued that this view is now obsolete: when interbank markets are...

We examine the relation between optimal venture capital contracts and the supply and demand for venture capital. Both the composition and type of financial claims held by the venture capitalist and entrepreneur depend on the market structure. Beside, different market structures involve different...

We study a simple rational expectations (RE) model whose asset pricing implications address some of the short-run mispricings, informational inefficiencies, and overreactions observed in real markets, without a need to resort to behavioral assumptions. We accomplish this by relying on the...

Most of those who take macro and monetary policy decisions are agents. The worst penalty which can be applied to these agents is to sack them if they are perceived to have failed. To be publicly sacked as a failure is painful, often severely so, but the pain is finite. Agents thus have loss...

Several authors have proposed series expansion methods to price options when the risk-neutral density is asymmetric and leptokurtic. Among these, Corrado and Su (1996) provide an intuitive pricing formula based on a Gram-Charlier Type A series expansion. However, their formula contains a...

This article discusses the out-of-court restructuring of the contractual obligations of a financially distressed firm, under conditions of asymmetric information among the firm’s creditors and in situations where a creditor bank makes concessions conditional on other creditors’ actions. I...