This paper puts forward an innovative construct called the Statute of Governance, by which a company can foster and enhance its corporate governance. The paper argues that it is not enough to list some principles of governance and a set of related good practices, as the Australian Stock Exchange...

During the last decades, banks off-balance sheet (OBS) activities (e.g. securitization, trading and fee-based activities) have greatly contributed to the increase in bank risk. However, the standard financial indicators such as the Value-at-Risk and the accounting leverage, exclude these...

Policymakers should not overreact to perceptions of corporate ‘dead money’, according to a new C.D. Howe Institute report. In “It’s Alive! Corporate Cash and Business Investment,” author Finn Poschmann points out that corporate cash holdings, as a share of output, have not grown since...

This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

This paper examines the incentives from stock options for loss-averse employees subject to probability weighting. Employing the certainty equivalence principle, I built on insights from Cumulative Prospect Theory (CPT) to derive a continuous time model to value options from the perspective of a...

In this article we investigate whether technical analysis tools are useful in periods of financial crisis. For the four major Latin American indices: —Bovespa (Brazil), IGBLV (Peru), IPC (Mexico) and IPSA (Chile)— we did not find evidence to support the use of Technical Analysis in periods...

The aim of this paper is to analyze the equilibrium default risk in a two-stage duopoly model, where firms decide their financial structure in the first stage of the game and take their output market decisions in the second stage of the game. Using the framework of Brander and Lewis (1986) we...

The information society represents a new stage of human civilization, a new way of life that implies intensive use of information in all domains of human activity and existence, with a great economic and social impact. The information society gives its members large access to information, a new...

Because a borrower often faces switching costs in dealing with individual banks, the financial health of any given bank might affect the borrower's cost of funds. These costs would be particularly large for firms that have close relationships with relatively few banks. The purpose of this paper...