This paper studies the interaction between financially constrained and financially strong firms on a procurement market. It characterizes and discusses a procurement agency’s optimal response when faced with financially asymmetric firms. By considering a dynamic setting, both present and...

The study investigates the role of financial development in boosting the investment efficiency of firms' investments in China. Using a large sample of firm-level financial data and country level economic data over the period 2004-2015, present study creates a link between financial and real...

This paper proposes and applies a method of moments to estimate dynamic decision models with corner solutions. The method is applied to estimate a model of price and inventory decisions using data of individual goods from a supermarket chain.

This paper proposes and applies a method of moments to estimate dynamic decision models with corner solutions. The method extends previous results by Hotz and Miller (1993) and Pakes (1994), and it allows for unobserved state variables affecting both the continuous choice (interior solution) and...

During the past century, three decision-making systems have arisen to accomplish a bankruptcy restructuring—judicial administration, a deal among the firm's dominant players, and a sale of the firm's operations in their entirety. Each is embedded in the Bankruptcy Code today, with all having...

This paper analyses the effects of US monetary policy on stock markets. We find that, on average, a tightening of 50 basis points reduces returns by about 3%. Moreover, returns react more strongly when no change had been expected, when there is a directional change in the monetary policy stance...

We construct novel measures of financial constraints using textual analysis of firms' annual reports and investigate their impact on stock returns. Our three measures capture access to equity markets, debt markets, and external financial markets in general. In all cases, constrained firms earn...

The tax credit rating mechanism was formally implemented in 2014. As an important tax collection and management innovation, it has attracted the attention of regulatory authorities and scholars. Different from the literature that directly examines corporate tax compliance, we focus on the impact...