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Heterogeneous Multiple Bank Financing, Optimal Business Risk and Information Disclosure

Bannier, Christina E. - 2005

This paper studies optimal risk-taking and information disclosure by firms that obtain financing from both a 'relationship' bank and 'arm's-length' banks. We find that firm decisions are asymmetrically influenced by the degree of heterogeneity among banks: lowly-collateralized firms vary optimal...

Persistent link: https://www.econbiz.de/10010263312

Credit Risk Transfer, Real Sector Productivity, and Financial Deepening

Behr, Patrick; Lee, Samuel - 2005

We derive the effects of credit risk transfer (CRT) markets on real sector productivity and on the volume of financial intermediation in a model where banks choose their optimal degree of CRT and monitoring. We find that CRT increases productivity in the up-market real sector but decreases it in...

Persistent link: https://www.econbiz.de/10010263314

Board Independence and CEO Turnover

Laux, Volker - 2005

It is widely believed that the ideal board in corporations is composed almost entirely of independent (outside) directors. In contrast, this paper shows that some lack of board independence can be in the interest of shareholders. This follows because a lack of board independence serves as a...

Persistent link: https://www.econbiz.de/10010263315

Kapitalmarktorientierte Risikosteuerung in Banken: Marktwertsteuerung statt Marktzinsmethode

Reichardt, Rolf - 2005

In diesem Beitrag wird das Konzept der Marktzinsmethode als Grundlage der dualen Risikosteuerung von Kredit- und Marktpreisrisiken in Frage gestellt. Die Kreditrisiken einer Bank implizieren bonitätsinduzierte Marktpreisrisiken und bankspezifische Refinanzierungskosten. Während die...

Persistent link: https://www.econbiz.de/10010263318

Modelling the role of credit rating agencies- Do they spark off a virtuous circle?

Bannier, Christina E.; Tyrell, Marcel - 2005

In this paper, we propose a model of credit rating agencies using the global games framework to incorporate information and coordination problems. We introduce a refined utility function of a credit rating agency that, additional to reputation maximization, also embeds aspects of competition and...

Persistent link: https://www.econbiz.de/10010263319

Inattentive Consumers

Reis, Ricardo - 2004

This paper studies the consumption decisions of agents who face costs of acquiring, absorbing and processing information. These consumers rationally choose to only sporadically update their information and re-compute their optimal consumption plans. In between updating dates, they remain...

Persistent link: https://www.econbiz.de/10010263340

Manufacturer Liability for Harms Caused by Consumers to Others

Hay, Bruce; Spier, Kathryn E. - 2004

their wealth then residual manufacturer liability creates an inefficient cross-subsidization and an overprovision of safety …

Persistent link: https://www.econbiz.de/10010263348

Trigger happy or gun shy? : Dissolving common-value partnerships with Texas shootouts

Brooks, Richard; Spier, Kathryn E. - 2004

Many partnership contracts (and other joint-venture agreements) include so-called 'Texas Shootout Clauses' to govern future breakups. In a Texas Shootout, one partner names a single buy-sell price and the other partner has the option to buy or sell at that price. While the prior literature has...

Persistent link: https://www.econbiz.de/10010263351

The Theory of the Demand for Health Insurance

Nyman, John A. - 2001

Conventional theory holds that moral hazard - the additional health care purchased as a result of becoming insured - is … less than its costs. The theory of the demand for health insurance presented here suggests that moral hazard is primarily …

Persistent link: https://www.econbiz.de/10010263363

The Demand for Insurance: Expected Utility Theory from a Gain Perspective

Nyman, John A. - 2001

Expected utility theory holds that the demand for insurance is a demand for certainty, because under the conventional … specification of the theory, it appears as if buyers of insurance prefer certain losses to actuarially equivalent uncertain ones … paper attempts to reconcile expected utility theory with this empirical evidence by suggesting that insurance is demanded to …

Persistent link: https://www.econbiz.de/10010263364