In this chapter, we review several key topics that lie at the intersection between labor economics and corporate finance. We discuss well-studied questions in this literature as well as new areas of research that are expanding the field of labor and corporate finance. First, we address the...

Uncertainty over future business conditions lies at the heart of firm decision-making. Uncertainty can arise from a myriad of sources and is difficult to measure. We present a simple conceptual framework showing how several key corporate decisions are affected by uncertainty. We also highlight...

This survey provides an overview of theoretical and empirical research on information flows in corporations. It highlights key frictions preventing effective information flows and discusses how organizational structure and corporate governance can alleviate these frictions, focusing on three...

Takeover defenses, also called antitakeover provisions, reflect decades of innovation in the interplay of offensive and defensive tactics in the market for corporate control. This paper summarizes research on how firms use takeover defenses and how defenses affect firm value and operations....

I survey the empirical and theoretical literature on merger waves, beginning with the very early work on aggregate waves and moving on to the study of industry-level waves and finally cross-border activity. I argue that although there is no single explanation for merger activity or waves-and...

One of the most consequential events in any firm’s lifetime is a major acquisition. Because of their importance, mergers and acquisitions (M&As) have been an enormous area of research. However, the vast majority of this research and survey papers summarizing this research have focused on...

The purpose of this study is to review the nascent literature devoted to the private component of the takeover process. Numerous important contributions have opened the black box of merger negotiations using unique data, such as the merger background in mandated filings and survey of M&A...

Informed risk management can reduce firm risk to tolerable levels, allowing companies to thrive. The consequences are new jobs, new products, and long-lasting benefits to society. However, the academic evidence on the importance of risk management is frequently described as ‘mixed’ (MacKay...

Abstract: Over the last two decades, the leveraged loan market has grown to a size comparable to the market for high-yield corporate bonds, creating a market for “leveraged finance” that includes about $3 trillion in outstanding debt. For issuers and investors in these markets, high-yield...

Corporate cash has become an increasingly large component of corporate balance sheets over the past fifty years. We survey the literature on corporate cash holdings that assesses (i) cross-sectional and time-series patterns in cash holdings; (ii) theoretical explanations for these patterns; and...