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We examine the evolution of the cross-sectional distribution of capital structure and find that capital structure is remarkably stable over time; firms with high (low) leverage remain relatively high (low) levered for over 20 years. Additionally, this relative ranking is observed for both public and private firms, and is largely unaffected by the process of… (More)
Uniform-price auctions are studied in which the seller may cancel part of the supply after observing the bids. This feature eliminates many of the 'collusive seeming' equilibria of the auction. In equilibrium the seller always sells the full quantity.
Jaime Zender, an anonymous referee, and participants at the American Finance Association meetings and at the Western Finance Association meetings for helpful comments.
Of 63 sexual assault victims who were a mean 7.9 years postevent, almost two thirds (60%, n = 38) demonstrated some degree of depression. Over half (56%, n = 35) the sample also reported a history of childhood sexual abuse. Three factors had a significant positive association with higher levels of depression: nondisclosure of the assault to significant… (More)
We consider a " managerial optimal " framework for top executive compensation, where top management sets their own compensation subject to limited entrench-ment, instead of the conventional setting where such compensation is set by a board that maximizes firm value. Top management would like to pay themselves as much as possible, but are constrained by the… (More)
a r t i c l e i n f o a b s t r a c t Moral hazard and asymmetric information have both been proposed as the motive behind the use of IPO lockup provisions, with each receiving empirical support in the literature. Rather than consider them to be mutually exclusive motivations, we hypothesize that each is dominant for a different set of firms. We provide… (More)
A financial institution that finances and monitors firms learns private information about these firms. When the institution seeks funds to meet its own liquidity needs, it faces adverse selection (" liquidity ") costs that increase with the risk of its claims on these firms. The institution can reduce its liquidity costs by holding debt rather than equity.… (More)
Dividend smoothing remains a puzzle for …nancial economists. We present a model in which smoothing of dividends arises as an equilibrium outcome. A manager who cares about the intrinsic value of the …rm as well as its current stock price has to decide how to allocate earnings between investments and dividends. Since the stock price is determined by… (More)
We thank John Hand for generously providing us with the data and answering many questions. We are grateful to Abstract How should the stock market react when a rm issues new equity t o retire debt? The traditional view is that, to reeect the loss of debt tax shields, the value of the rm should decline by an amount approximately equal to the rm's marginal… (More)