We use option prices to test if monetary policy has a significant impact on stock market participants' expectations. We find that, with loose monetary policy, traded equity put (call) options are significantly cheaper (more expensive) versus tight monetary policy. Higher call option prices...

How credible is the widely held belief that the Federal Reserve supports the markets? While this ``Greenspan Put" has received much public attention there is little empirical evidence that documents its existence and significance. In this paper, we exploit the time-series variation in the Fed...

We study a manufacturer's strategic use of a dual-sourcing option when facing suppliers who possess private information about their likelihood of experiencing a supply disruption. The manufacturer can diversify its supply by ordering from both suppliers, but we find that the cost of doing so is...

This paper analyzes a unit-contingent power purchase agreement between an electricity distributor and a power plant. Under such a contract the distributor pays the plant a fixed price if the plant is operational and nothing if plant outage occurs. Pricing a unit-contingent contract is...

We study the coordination of production decisions for multiple products among many manufacturers and many suppliers, each with private information about its own objective and its own production capabilities. Our methodology does not require a probabilistic model of the beliefs of each decision...

In a 2008 survey of 138 companies, 58% reported that they suffered financial losses within the last year due to a supply disruption. This article emphasizes the challenges and opportunities in supply risk management arising from the decentralized nature of supply chains and highlight how supply...

Frequently, manufacturers experience supply disruptions due to supplier bankruptcies. Manufacturers can increase supplier reliability by providing suppliers subsidies in excess of suppliers' production costs. We examine the optimal subsidy decisions of manufacturers in four supply chain...

We show that an easily computed and simply structured policy for making workorder decisions is optimal in the Clark-Scarf inventory model. That is a model of a make-to-stock multistage serial manufacturing process with convex costs of finished goods inventory, a set-up cost for purchasing,...

Credit provides a means for uninsured households and businesses to manage disaster losses, but access to credit may be tenuous after severe events. Using lender fixed effects models, we examine how natural disasters affect the amount of credit supplied by community lenders in developing and...