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Why Has CEO Pay Increased so Much?
This paper develops a simple equilibrium model of CEO pay. CEOs have different talents and are matched to firms in a competitive assignment model. In market equilibrium, a CEO’s pay changes one forExpand
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The Perverse Effects of Partial Labour Market Reform: Fixed-Term Contracts in France
We argue that the effects of a partial reform of employment protection by allowing firms to hire workers on fixed-term contracts may be perverse. The main effect may be high turnover in entry-levelExpand
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A Multiplicative Model of Optimal CEO Incentives in Market Equilibrium
This paper presents a unified theory of both the level and sensitivity of pay in competitive market equilibrium, by embedding a moral hazard problem into a talent assignment model. By consideringExpand
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Vulnerable Banks
When a bank experiences a negative shock to its equity, one way to return to target leverage is to sell assets. If asset sales occur at depressed prices, then one bank's sales may impact other banksExpand
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Financial Contracting with Optimistic Entrepreneurs
Optimistic beliefs are a source of nonpecuniary benefits for entrepreneurs that can explain the "Private Equity Puzzle." This paper looks at the effects of entrepreneurial optimism on financialExpand
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The Perverse Effects of Partial Labor Market Reform: Fixed Duration Contracts in France
Rather than decrease firing costs across the board, a number of European countries have allowed firms to hire workers on fixed-duration contracts. At the end of a given duration, these contracts canExpand
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Connected Stocks
We connect stocks through their common active mutual fund owners. We show that the degree of shared ownership forecasts cross-sectional variation in return correlation, controlling for exposure toExpand
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Trade-Offs in Staying Close: Corporate Decision Making and Geographic Dispersion
We investigate whether the geographic dispersion of a firm affects corporate decision making. Our findings suggest that social factors work alongside informational considerations to make geographyExpand
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Entrepreneurship and the Stigma of Failure
Entrepreneurial activity varies substantially across regions and sectors and appears to be related to the stigma of failure. To understand this phenomenon, I present a multiple-equilibrium modelExpand
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The WACC Fallacy: The Real Effects of Using a Unique Discount Rate
We provide evidence that firms fail to properly adjust for risk in their valuation of investment projects, and that this behavior leads to value-destroying investment decisions. If managers tend toExpand
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