Corporate Financing : An Arti ¢ cial Agent-based Analysis

  title={Corporate Financing : An Arti ¢ cial Agent-based Analysis},
  author={Thomas H. Noe and Michael Rebello and Jun Wang},
We examine corporate security choice by simulating an economy populated by adaptive agents who learn about the structure of security returns and prices through experience. Through a process of evolutionary selection, each agent gravitates toward strategies that generate the highest payo¡s. Despite the fact that markets are perfect and agents maximize value, a ¢nancing hierarchy emerges in which straight debt dominates other ¢nancing choices. Equity and convertible debt display signi¢cant… CONTINUE READING
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