We test the hypothesis that the degree of asymmetric information should decrease as financial systems develop, in a panel co-integration framework with annual data for 32 countries. To this end, we extend Barron et al.'s (1998) model to derive a measure of analysts' consensus that takes into...

We test two hypotheses about the determinants of closed-end fund premia and discounts using a comprehensive sample of non-taxable and taxable funds for the period 1988 to 2002. We test whether fund premia reflect agency costs, and the potential tax liability associated with unrealized capital...

We test the hypothesis that the degree of asymmetric information should decrease as financial systems develop, in a panel co-integration framework with annual data for 32 countries. To this end, we extend Barron et al.'s (1998) model to derive a measure of analysts' consensus that takes into...

We study the strategies of the market in the inter-dealer market. We show that market makers actively learn from the dealers they trade with and strategically react to the information content of the orders they receive. We identify quot;hidingquot; and quot;experimentingquot; as main types of...

The study examines the relationship between institutional ownership and liquidity of stocks, focusing on the effect of institutions' information advantage on liquidity. The information advantage of institutions can affect liquidity through two channels: adverse selection and information...

In a model with capital accumulation, aggregate risk and competitive intermediaries, Abraham and Carceles-Poveda (2006) show that the constrained efficient allocations can be decentralized as a competitive equilibrium with endogenous borrowing limits that do not allow for default if one also...

This study provides a comprehensive analysis of credit rating economics and draws conclusions on the nature of regulation. It starts with an overview of the credit rating industry and introduces a framework that structures multiple rating agency functions. At the heart of the credit rating...

The objective of this research is to determine the optimal rating philosophy for the rating of SMEs, and to describe the consequences of the chosen philosophy on several related aspects. As to our knowledge, this is the first paper that studies the considerations of financial institutions on...

We analyze a sample of UK syndicated loan contracts, containing detailed firm data for both private and public borrowers for the time period 1996 through 2005 to explore the impact of information asymmetry on loan spreads. Consistent with the asset pricing literature, we find that lenders charge...

This paper contributes to the debate about the relative qualities of floor and electronic trading systems by analysing the effects of bringing forward the Xetra closing time from 8:00 pm to 5:30 pm in November 2003, while the Frankfurt floor remains open until 8:00 pm. This natural experiment...