We study an environment where the capital structure of banks and firms are jointly determined in equilibrium, so as to balance the benefits of the provision of liquidity services by bank deposits with the costs of bankruptcy. The risk in the assets held by firms and banks is determined by the...

This article analyzes the patterns of financing for entrepreneurial firms in Canada. We compare the predictions of major theories of entrepreneurial finance and some more recent ideas (e.g., crowdfunding-related ideas/theories) with empirical evidence. Regression and correlation analyses were...

We build a model of debt for firms with investment projects, for which flexibility and free cash flow problems are important issues. We focus on the factors that lead the firm to select the zero-debt policy. Our model provides an explanation of the so-called "zero-leverage puzzle". It also helps...