Innovation scholars highlight the economic benefits to firms, while research findings on the relationship between innovation output and economic returns remain mixed. In this study, we develop the profiting from innovation (PFI) framework and address the crucial role of financial constraints in...

This study compares standard auctions when bidders are financially constrained and valuation is endogenously determined by ex post investment. Bidders have a convex cost function because of financial constraints or borrowing costs. When the valuation is linear in investment, the revenue and...

[enter Abstract Body]In this paper, we investigate the credit constraints of Vietnamese cooperatives during the COVID-19 pandemic. Our main source of data is from a cooperative-level survey designed to access impact of COVID-19 outbreak on cooperative performance, combined with research of...

We investigate how a combination of limited liability and preexisting debt distort firms’ investment and equity payout decisions. We show that equity holders have incentives to “double-sell” cash flows in default, leading to overinvestment, provided that the firm has preexisting debt and...

We provide a theoretical framework to analyze how financial constraints hinder migration. Introducing wealth heterogeneity and borrowing constraints into a random utility maximization model of migration, we find evidence of multilateral resistance to migration stemming from borrowing...

Most quantitative macroeconomic models with financial frictions assume collateral constraints as a borrowing constraint. However, recent studies show that most non-financial corporate debts in the U.S. are based on the value of cash flow from firms' continuing operations. This paper...

This study investigates the impacts of credit supply on economic growth and financial crisis. Excess credit supply can make the economy and financial markets more vulnerable. While credit supply can drive economic growth by reallocating resources, it can also make the economy and financial...