This paper presents an econometric model to value latent information underlying corporate events. This model computes the market's inference of the value of latent information from the probability of an event, conditional on firm-specific, preevent information. It provides a convenient framework...

To test the major prediction of a signalling hypothesis-that the market price is m onotonic in the signal-the price response to the signal must be measu red. Since a signal is an outcome of a rational decision rule of the signaller, the market can infer the true type of the signaller from t he...

Optimal dynamic regulatory policies for closing ailing banks and for deposit insurance premia are derived as functions of the rate of flow of bank deposits and interest paid on deposits, the economy's risk-free interest rate, and the regulators' bank audit/administration costs. Under competitive...