This paper presents evidence on the failed initial public offerings that used best efforts contracts. Out of 732 best efforts IPOs attempted in 1980-84, 186 IPOs (about one fourth) failed to meet minimum sales requirement and were subsequently withdrawn. Offerings with greater uncertainty about...

This study compares the profitability, operational efficiency, and firm value over the 1985-1990 period of 100 firms that had IPOs in 1985 compared to a matched sample of similar firms which had their IPO before 1980. We find that the 1985 IPO firms were more profitable, operationally more...

This article analyzes the role of liquidity in the sovereign credit default swap (CDS) market. We employ a continuous-time specification to incorporate illiquidity as an additional pricing factor of default swap contracts for the most developed economies. The illiquidity discount process is...

This paper tests a new hypothesis that bank managers issue public debt, at least in part, to convey positive, private information and refrain from issuance to hide negative, private information. This positive selection hypothesis is tested against the traditional adverse selection hypothesis. We...

The paper develops a simple model of optimal corporate ownership structure in which costs and benefits of ownership concentration are analysed.

We incorporate costly external finance in a production based asset pricing model and investigate whether financing frictions are quantitatively important for pricing a cross-section of expected returns. We show that the common assumptions about the nature of the financing frictions are captured...

Corporations in many countries are run by controlling shareholders whose cash flow rights in the firm are substantially smaller than their control rights. This separation of ownership and control allows the controlling shareholders to pursue private benefits at the cost of minority investors by...

This paper embeds security design in a model of evolutionary learning. We consider a competitive and perfect financial market where agents, as in Allen and Gale (1988), have heterogeneous valuations for cash flows. Our point of departure is that, instead of assuming that agents are endowed with...

Listing of stocks on the stock exchange offers business firms several advantages such as diversification, liquidity, establishing a value for the firm etc. The present paper analyses stocks of six commercial banks (viz., Dubai Commercial Bank, Emirates Bank International, National Bank of Dubai,...