The proposal for banks to issue contingent capital that must convert into common equity when the banks’ stock price falls below a specified threshold, or “trigger,” does not in general lead to a unique equilibrium in equity and contingent capital prices. Multiple or no equilibrium arises...

Contingent capital (CC), which intends to internalize the costs of too-big-to-fail in the capital structure of large banks, has been under intense debate by policy makers and academics. We show that CC with a market trigger, in which direct stake-holders are unable to choose optimal conversion...

This study focuses on Chinese B-share initial public offerings (IPOs) and investigates their initial returns, operating performance change before and after listing, and long-run market performance. (Chin Econ/NIAS-Han)

The paper studies the constrained efficiency of the aggregate stock market in which the investor obtains gain-loss utility directly from fluctuations in asset returns, in addition to consumption. I reveal that the competitive equilibrium is inefficient without any frictions as long as the agent...