Anand Mohan Goel

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We develop a theory which shows that merger waves can arise even when the shocks that precipitated the initial mergers in the wave are idiosyncratic. The analysis predicts that the earlier acquisitions produce higher bidder returns, involve smaller targets, and result in higher compensation gains for the acquirer’s top management team than the later(More)
In a weighted majority game each player has a positive integer weight and there is a positive integer quota. A coalition of players is winning (losing) if the sum of the weights of its members exceeds (does not exceed) the quota. A player is pivotal for a coalition if her omission changes it from a winning to a losing one. Most game theoretic measures of(More)
We examine the characteristics of endogenously-determined optimal incentive contracts for agents who envy each other and work for a risk-neutral (non-envious) principal. Envy makes each agent care not only about absolute consumption but also about relative consumption. Incentive contracts in this setting display properties strikingly different from those(More)
We develop a model of the effect of CEO overconfidence on dividend policy and empirically examine many of its predictions. Consistent with our main prediction, we find that the level of dividend payout is lower in firms managed by overconfident CEOs. We document that this reduction in dividends associated with CEO overconfidence is greater in firms with(More)
An enduring puzzle is why credit rating agencies (CRAs) use a few categories to describe credit qualities lying in a continuum, even when ratings coarseness reduces welfare. We model a cheap-talk game in which a CRA assigns positive weights to the divergent goals of issuing firms and investors. The CRA wishes to inflate ratings but prefers an unbiased(More)
We model agents whose preferences exhibit envy. An envious agent’s utility is increasing in what he has and decreasing in what others have. With this setup we are able to provide a new perspective on the nature of investment distortions with centralized and decentralized capital budgeting systems. Centralized capital budgeting leads to corporate socialism(More)
We posit that screening IPOs requires specialized labor which, in the short run, is in fixed supply. Hence, a sudden increase in demand for IPO financing increases the compensation of IPO screening labor. Increased compensation results in reduced screening which encourages sub-marginal firms to enter the IPO market, further increasing the demand for(More)
To the layperson, the observation that human beings envy each other—they are unhappy if someone else has more than they have—seems so obvious that it needs little elaboration. Those who have children observe it in siblings at a fairly early stage.While the behavioral manifestations of envy are more sophisticated in adults, its presence does not seem to(More)
This paper develops a theory of the relationship between the leverage ratios of banks and borrowers who take loans to purchase houses. The bank’s payoff depends primarily on the value of the house that serves as collateral backing the loan. The analysis is in the context of a two-period model in which house prices and the capital structure decisions of(More)