In traditional signalling models, high-quality firms can separate themselves from low-quality firms by using their payout policy. Standard agency theory suggests that shareholders will pressure managers to pay out all excess cash in order to avoid overinvestment.If firms have different...

We find that dividend increases are associated with significant positive shifts in average earnings, while dividend decreases are associated with significant negative shifts in average earnings. Moreover, earnings over the years following dividend increases will be higher than the previous level...

The paper examines dividend policy for a sample of Swiss companies. Several factors that determine cross-sectional variations in dividend policy - such as profitability, growth opportunities, and riskiness - are identified. Price volatility seems to stand out as the most significant factor....

We examine banks' choice between two costly instruments used to identify good loan applicants: direct screening by acquiring borrower-specific information and collateral requirements. We show that with longer relationships the preference for screening increases both in initial and in later...

Credit bureaus and public credit registers allow lenders to share information about borrowers. Since information asymmetries have been identified as an important source of bank profits, it may seem that the establishment of such arrangements will lead to lower investment in information acquired...

Information sharing and collateral are both devices that help banks reduce the cost of adverse selection. We examine whether they are likely to be used as substitutes (information sharing reduces the need for collateral) or complements. We show that information sharing via a credit bureaus and...

We examine the conditions required for the existence of private credit bureaus, their ownership and coverage. Our model implies that bank consortia will most likely be preferred by banks, but that they will lead to restricted coverage. Independent credit bureaus have higher coverage, but they...

Since information asymmetries have been identified as an important source of bank profits, it may seem that the establishment of information sharing (e.g., introducing credit bureaus or public registers) will lead to lower investment in acquiring information. However, banks base their decisions...