The Hollywood quot;studio systemquot; - with production, distribution, and exhibition vertically integrated - flourished from the late teens until 1948, when the U.S. Supreme Court issued its famous Paramount decision. The Paramount consent decrees required the divestiture of affiliated theater...

A real options theory - in its classic formulation - suggests that firms invest less during times of high uncertainty, that is, uncertainty depresses investment. However, several theoretical extensions predict that the relationship between investment and uncertainty may be non-linear, or even...

In a market where sellers are endowed with heterogeneous qualities of the same good and are more informed than buyers, high quality sellers' chances to trade might depend on their ability to inform buyers about the quality of the goods they offer. We study under what conditions and to what...

This paper is concerned with those actions of business firms which are aimed at managing the business and economic risks and uncertainties. The standard example of risk management is finance and insurance but these only capture a small fraction of the business risk faced by a company in a...

Among the clearest rules in U.S. securities law is the duty that brokers have to quot;seek the best execution that is reasonably available for its customers' orders.quot; The problem with the current orientation of the policy discussion on best execution is that it has focused on the narrow, yet...

It is well known in the credence-good literature that in an expert-client relationship, under the Liability assumptions, clients have to reject the expert's serious-treatment recommendations with a positive probability to ensure that the expert honestly recommends treatments. Inefficiency arises...

Asymmetric information is a classic example of market failure that undermines the efficiency associated with perfectly competitive market outcomes: the “lemons” market. Credible certification, that substantiates unobservable characteristics of products that consumers value, is often...

Replications of experiments are typically conducted to verify initial findings, increase their external validity, or to study the boundary conditions of treatment effects. A crucial and implicitly made assumption is that outcome measures in experiments are sufficiently comparable (i.e.,...

This paper explores the interaction between insider trading and seasoned equity offering in the context of Myers and Majluf (1984). Private information conveyed through trading activities may mitigate information asymmetry and improve capital market efficiency. Moreover, an insider has less...

Theory predicts that since a firm with market power has more stable cash flows because of its ability to set prices in the product market, its stock price is less sensitive to order flow (Peress, 2010), which results in greater stock liquidity. We test this prediction on a large sample of firms...