A Fast Literature Search Engine based on top-quality journals, by Dr. Mingze Gao.
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Results 10,990 resources
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Debt overhang is associated with higher financial fragility and slower recovery from recession. However, while household credit booms have been extensively documented to have this property, we find that corporate debt does not fit the same pattern. Newly collected data on nonfinancial business liabilities for 18 advanced economies over the past 150 years shows that, in the aggregate, greater frictions in corporate debt resolution make for slower recoveries, with weak investment and more persistent “zombie firms” and that this is an important factor in explaining the difference in outcomes relative to household credit booms.
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Large Japanese banks often engaged in sham loan restructurings that kept creditflowing to otherwise insolvent borrowers (which we call zombies). We examinethe implications of suppressing the normal competitive process whereby thezombies would shed workers and lose market share. The congestion createdby the zombies reduces the profits for healthy firms, which discourages theirentry and investment. We confirm that zombie-dominated industries exhibitmore depressed job creation and destruction, and lower productivity. We presentfirm-level regressions showing that the increase in zombies depressed theinvestment and employment growth of non-zombies and widened the productivitygap between zombies and non-zombies. (JEL G21, G32, L25)
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This paper examines how divorce laws affect couples' intertemporal choices and well-being. Exploiting panel variation in US laws, I estimate the parameters of a model of household decision-making. Household survey data indicate that the introduction of unilateral divorce in states that imposed an equal division of property is associated with higher household savings and lower female employment, implying a distortion in household assets accumulation and a transfer toward wives whose share in household resources is smaller than the one of their husband. When spouses share consumption equally, separate property or prenuptial agreements can reduce distortions and increase equity. (JEL D13, D14, D91, J12, J16, K36)
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Across a broad range of equipment types and industries, we document a pattern of local capital reallocation from older firms to younger firms. Start-ups purchase a disproportionate share of old physical capital previously owned by more mature firms. The evidence is consistent with financial constraints driving differential demand for vintage capital. The local supply of used capital influences start-up entry, job creation, investment choices, and growth, particularly when capital is immobile. Meanwhile, as suppliers of used capital, incumbents accelerate capital replacement in the presence of younger firms. The evidence suggests previously undocumented benefits to co-location between old and young firms.
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In business and politics, gifts are often aimed at influencing the recipient at the expense of third parties. In an experimental study, which removes informational and incentive confounds, subjects strongly respond to small gifts even though they understand the gift giver's intention. Our findings question existing models of social preferences. They point to anthropological and sociological theories about gifts creating an obligation to reciprocate. We capture these effects in a simple extension of existing models. We show that common policy responses (disclosure, size limits) may be ineffective, consistent with our model. Financial incentives are effective but can backfire.
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Although a number of prior papers have argued the benefits to foreign firms of cross‐listing their shares in the U.S., the number of foreign firms exiting U.S. capital markets has been increasing. This has occurred despite the difficulties foreign firms face in deregistering from the Securities and Exchange Commission (SEC). This paper examines the reasons underlying this trend. One of our main findings is that the passage of the Sarbanes‐Oxley Act has reduced the net benefits of a U.S. listing and registration, particularly for smaller foreign firms with lower trading volume and stronger insider control.
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We study the effect of subjective mortality beliefs on life‐cycle behavior. With new survey evidence, we document that survival is underestimated (overestimated) by the young (old). We calibrate a canonical life‐cycle model to elicited beliefs. Relative to calibrations using actuarial probabilities, the young undersave by 26%, and retirees draw down their assets 27% slower, while the model's fit to consumption data improves by 88%. Cross‐sectional regressions support the model's predictions: Distorted mortality beliefs correlate with savings behavior while controlling for risk preferences, cognitive, and socioeconomic factors. Overweighting the likelihood of rare events contributes to mortality belief distortions.
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Many believe that compensation, misaligned from shareholders’ value due to managerial entrenchment, caused financial firms to take risks before the financial crisis of 2008. We argue that, even in a classical principal-agent setting without entrenchment and with exogenous firm risk, riskier firms may offer higher total pay as compensation for the extra risk in equity stakes borne by risk-averse managers. Using long lags of stock price risk to capture exogenous firm risk, we confirm our conjecture and show that riskier firms are also more productive and more likely to be held by institutional investors, who are most able to influence compensation.
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Journals
- American Economic Review (4,617)
- Journal of Finance (1,715)
- Journal of Financial Economics (2,629)
- Review of Financial Studies (2,029)
Topic
- Bond (505)
- CEO (249)
- Mergers and Acquisitions (155)
- Director (130)
- Capital Structure (95)
Resource type
- Journal Article (10,990)
Publication year
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Between 2000 and 2024
- Between 2000 and 2009 (4,062)
- Between 2010 and 2019 (5,189)
- Between 2020 and 2024 (1,739)