We derive the optimal crowdfunding contract of a financially constrained monopolist and analyze its implications for production, investment and welfare. Crowdfunding contracts may serve as a price-discrimination mechanism, forcing pivotal consumers to pay a premium above the future spot price,...

It is commonly assumed that binding collateral constraints amplify the impact of aggregate shocks on the economy. However, we show that when firms can hedge against aggregate risk with state-contingent lending contracts, binding collateral constraints no longer amplify shocks relative to the...

This paper examines the relationship between monetary policy and investor sentiment across conventional and unconventional monetary policy regimes. During conventional times, we find that a surprise increase in the fed funds rate leads to a large drop in investor sentiment that reverses after...

We examine a large and unique panel containing survey and financial statement data on small and medium sized private enterprises (SMEs) in Germany from 1991 to 2011. From the survey data, we derive a financial constraints measure based on managers' self-perception. We find that our measure...

Our paper estimates the speed of moment adjustment based on the first difference of the lead (t 1) leverage levels (actual lead) and lag (t-1) leverage levels (actual lag) to the first difference of simulated lead (target) leverage levels and lag levels (actual lag leverage) for firm level data....

This paper builds a dynamic capital structure model of the firm with costly external financing and long term debt, and studies the joint interactions between a firm's corporate cash policy, investment policy and strategic default risk. Investment takes the form of a real option and is both...

Estimates of Frisch labor-supply elasticities are biased in the presence of borrowing constraints. We show that this estimation bias is less pronounced for secondary than for primary earners. The reason is that, in households with two earners and joint borrowing constraints, wage-rate...

Theoretical and empirical approaches have stressed the existence of financial constraints in firms' innovative activities. Although a large number of innovation projects are abandoned before their completion, the empirical evidence has focused on the determinants of innovation while failed...

Using a database of 23,000 firms in 45 economies, we test the quantitative importance of access to finance and access to public and private credit for the determination of misallocation. We first derive measures of factor market and size distortions, and then use these measures within a...

This paper examines the funding liquidity faced by hedge funds and the resulting implication for stocks' excess return co-movement. We find that hedge fund ownership tends to induce a higher stocks' return co-movement with each other, compared to other institutional investors like mutual funds...