We investigate how idiosyncratic lender shocks impact corporate investment. Lenders with recent default experience … write stricter loan contracts, leading to a reduction in real investment for borrowing firms. The decline in investment is … evidence suggests that defaults inform lenders about investment opportunities and their screening ability, and adjustments to …

explanations of the investment premium including the q-theory of investment and behavioral finance. To explain the evidence, I …The investment premium -- the finding that firms with low asset growth deliver high average returns -- is an integral … part of recent factor models. I document empirically that the investment premium (1) reflects leverage, (2) does not exist …

This paper develops a dynamic model of capital structure and investment. In a world with low and high ability managers …, the former mask as the latter, but to do so have to overstate both earnings and investment. Debt is a mechanism that … counterproductive, as it generates costs and no expected payoff. The security design that asymptotically implements optimal investment …

We study the interaction between financing and investment decisions in a dynamic model where the firm has multiple debt … issues and equityholders choose the timing of investment. Jointly optimal capital and priority structures can virtually … eliminate investment distortions, because debt priority serves as a dynamically optimal contract. Examining the relative …

We study the effects of uncertainty on corporate leverage adjustments with respect to investment spikes and find that … overlevered and underlevered firms behave very differently in response to the combination of uncertainty and investment spikes …

setting using investment level data. We find allocative inefficiency across ownership to be exacerbated under policy … more capital in certain markets even after returns on investment are dampened by negative policy shocks, suggesting that …

reduce shareholders' incentives to default strategically. We show theoretically and empirically that the presence and the … likely to have empty creditors if these would face powerful shareholders in debt renegotiation. The empirical evidence … confirms that more CDS insurance is written on firms with strong shareholders and that CDSs increase the bankruptcy risk of …

This paper examines the effects of tax system changes and corporate tax payout changes on capital investment. We would … expect a change in capital investment when the corporate tax payout changes and also when there is a shift from one tax … system to another. This study examines the effects on capital investment of:(1) changing in corporate tax payout in Canada …

I examine the effects of entrenchment on corporate investment and firm performance. To achieve identification, I use a … of overseeing investment projects …