We examine whether internal funds matter for investment when the measurement error in q is addressed. By carefully employing methodologies that tackle the measurement error in q, we show that cash flow is a significant determinant of investment. We also find that an analyst forecast based q...

The conflicting nature of the existing evidence on the pecking order theory is due to the difference between financing practices of large and small firms, and the skewness of the firm size distribution. The theory performs poorly for small firms because they have low debt capacities that are...

We examine the investment-cash flow sensitivity of US manufacturing firms in relation to five factors associated with capital market imperfections - fund flows, institutional ownership, analyst following, bond ratings, and an index of antitakeover amendments. We find a steady decline in the...

Pricing compound and min-max options requires the estimation of the bivariate normal probability. Using the slower Simpson numerical integration as the accuracy benchmark, four alternative bivariate normal probability estimation methods are compared in terms of accuracy and speed in pricing...

Several research studies in finance have investigated the effect of financial factors on investment decisions of firms. More recently, researchers have extended conventional models of firm-investment by incorporating a role for financing constraints in determining the firm's investment decision....

EFFICIENCY AND ACCURACY OF ALTERNATIVE IMPLEMENTATIONS OF NO-ARBITRAGE TERM STRUCTURE MODELS OF THE HEATH-JARROW-MORTON CLASSTae Young ParkAbstractModels of the term structure of interest rates play a central role in the modern theory of pricing bonds and other interest rate claims. Term...

We examine how the cost of corporate credit varies around fiscal consolidations aimed at reducing government debt. Using a new dataset on fiscal consolidations and syndicated corporate loan data, we find that loan spreads increase with fiscal consolidations, especially for small firms, domestic...

This dissertation examines whether simultaneously conditioning on themultidimensional characteristics of information signals can help predict returnsthat are of economic significance. We use large price changes, publicannouncements, and large volume increases to proxy for the...