) competition in the development and marketing of the resulting product. The competitive interactions that occur substantially … these interactions. Implementation of the model shows that competition in R&D, in general, not only increases production and …

value (APV). The risk-free rate of interest must be after-tax. Debt capacity depends on the APV and target debt ratio for … the underlying asset, on the option delta and on the amount of risk-free borrowing or lending that would be needed for … follow the tradeoff theory of capital structure will be lower than target ratios for assets in place. Our results can …

This paper examines distortions in corporate investment decisions when a new project changes firm risk. It presents a … dynamic model in which a self-interested, risk-averse manager makes investment decisions at a levered firm. The model … factors in this decision are the expected changes in the values of future tax shields and bankruptcy costs when firm risk …

. When the agent can trade the market portfolio to partially hedge against investment risk, the systematic volatility is … investment payoff is a series of flows, the agent's idiosyncratic risk exposure alters both the implied option value and the …

capacity on competition among" generators. We show that there may be no relationship between the effect of a transmission line …" in spurring competition and the actual electricity that flows on the line. We then investigate the" equilibria that are … relatively small investments in transmission may yield surprisingly large" payoffs in terms of increased competition …

We present a model in which managers are risk-averse and firms compete for scarce managerial talent ("alpha"). When …-insurance among employees. In anticipation, risk-averse managers may churn across firms or undertake aggregate risks in order to delay … the revelation of their true quality. The result is excessive risk-taking with pay for short-term performance and an …

How does competition affect innovation and how it is financed in R&D-intensive firms? We study the interaction between … competition, R&D investments, and the financing choices of such firms using data on biopharmaceutical firms. To motivate the … existing assets are all determined in response to the degree of competition in the industry. The key predictions are that, as …

stance. When decomposing the VIX into two components, a proxy for risk aversion and expected stock market volatility … ("uncertainty"), we find that a lax monetary policy decreases both risk aversion and uncertainty, with the former effect being …