Loan screening and monitoring are critical to loan performance, but incentives are diminished for securitized loans. Risk retention is intended to harmonize the interests of originators and investors; however, it is unclear to what extent investors anticipate and respond to originators’...

Loan screening and monitoring are critical to loan performance, but incentives are diminished for securitized loans. Risk retention is intended to harmonize the interests of originators and investors; however, it is unclear to what extent investors anticipate and respond to originators’...

We investigate whether originators of mortgage-backed securities lower the comprehensibility of disclosure documents to obfuscate low security quality. Utilizing commonly used complexity proxies primarily based on the volume of the investment prospectus, we find no impact on the performance of...

We investigate whether originators of mortgage-backed securities lower the comprehensibility of disclosure documents to obfuscate low security quality. Utilizing commonly used complexity proxies primarily based on the volume of the investment prospectus, we find no impact on the performance of...

We use the tools of mechanism design, combined with the theory of risk measures, to analyze how a cash constrained owner of an asset with known stochastic returns raises capital from a population of investors that differ in their risk aversion and budget constraints. The issuer partitions the...