We use the reform process of the Sarbanes-Oxley Act of 2002 as a quasi-natural experiment to identify the impact of corporate governance reform on foreign exchange risk hedging, and find that the substantial improvements in governance standards reduced foreign exchange exposure and increased...

We investigate optimal capital requirements in a model in which banks decide on their investment in credit scoring systems. Our main result is that regulators should encourage sophisticated banks to keep their asset portfolios safe, while assets with high systematic risk should be concentrated...

We analyze the implications of the decision to spawn or to retain a new product for the nature and evolution of the firm. In our model, a new product is spawned if the fit between the product and its parent firm organization is not adequate. We focus on the impact of the firm's history of...

We consider the financing of a research projectunder uncertainty about the time of completion and the probability of eventualsuccess. We distinguish between two financing modes, namely relationshipfinancing, where the allocation decision of the entrepreneur is observable, andarm's-length...

The fastest growing segment of private equity deals are secondary buyouts - sales from one PE fund to another. Using a comprehensive sample of leveraged buyouts we investigate whether SBOs are value-maximizing, or reflect opportunistic behavior. To proxy for adverse incentives, we develop buy...

We study the impact of climate-related patent approvals on financial markets. We exploit the quasi-random assignment of patent examiners as an exogenous shock in patent approvals to seek for causal interpretations. We find that innovative firms with lucky draws in the patent examiner lottery...

We investigate the role of industry specialization in horizontal cross-border mergers and acquisitions. We find that acquirers from more specialized industries in a country are more likely to buy foreign targets in countries that are less specialized in these same industries. The role of...

We study the role and performance of private equity (PE) in corporate asset sales. Corporate sellers obtain significantly positive excess returns in PE deals, gains in wealth significantly greater than for intercorporate asset sales. Based on exit valuations for 98% of PE deals, we find gains in...