Adolfo de Motta

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CEOs with large networks earn more than those with smaller networks. An additional connection to an executive or director outside the firm increases compensation by over $17,000 on average, and accounts for about 10% of total pay. An additional premium is associated with “important” members: insiders at other firms (especially large ones), geographically(More)
Firms that are located within industry clusters tend to make more acquisitions than their counterparts in the same industry that are not located within a cluster. As we show, if this increased tendency to acquire other firms arises because locating close to other industry participants facilitates acquisitions (e.g., by facilitating the acquisition of(More)
We develop a model of a firm whose production process requires it to initiate and nurture a relationship with its stakeholders. Because there are spillover benefits of being associated with a “winner,” the perceptions of stakeholders and potential stakeholders can affect firm value. Our analysis indicates that while transparency (i.e., generating(More)
We present an analysis of price competition under asymmetric information where the equilibrium price reacts asymmetrically to changes in the marginal costs of different competitors. In a model where one firm has private information concerning the profitability of serving a subset of customers in the market, an increase in the marginal cost of an uninformed(More)
We investigate how predatory government policies (expropriation, lack of property rights protection, corruption, crime) interact with managerial incentives in shaping firm governance structure. Our model shows that owners have lower incentives to encourage valuemaximization by managers if the government is likely to expropriate firm profits. This result(More)
This paper provides a theory of informal communication (cheap talk) between firms and the capital market. The theory emphasizes the central role that agency conflicts play in firms’ disclosure policies. Since managers’ information is a consequence of their actions, incentive compensation and information disclosure become two intrinsically linked aspects of(More)
Assessments of the trade-off theory have typically compared the present value of tax benefits to the present value of bankruptcy costs. We show that this comparison overwhelmingly favors tax benefits, suggesting that firms are under-leveraged. However, when we allow firms to experience even modest financial distress costs prior to bankruptcy (e.g.,(More)
Osmel Manzano May 2000. Tax Effects upon Oil Field Development in Venezuela. Important reforms have been made to the oil sector tax code in Venezuela. Given its diversity of oil resources, there was a concern that some resources were not being exploited because of the structure of the tax code. This paper uses traditional theoretical models to review these(More)
We analyze the financing decisions of firms that face a labor market with search frictions and examine public policy choices that influence the firms’ financing and liquidation choices. In our model, debt facilitates the process of creative destruction (i.e., the elimination of inefficient firms to facilitate the creation of new firms) but may induce(More)
a r t i c l e i n f o We examine the information content of Form-4 filings following extreme market downturns in the pre and post-Sarbanes–Oxley-Act (SOX) periods. We find that the announcement period abnormal returns under extreme market conditions are larger and this effect is stronger in the more tighter disclosure rules in the post-SOX period. Insider(More)