This paper investigates the relation between stock liquidity and firm performance. The study shows that firms with liquid stocks have better performance as measured by the firm market-to-book ratio. This result is robust to the inclusion of industry or firm fixed effects, a control for...

This paper investigates, from both a theoretical and clinical perspective, bond tender offers accompanied by a threat to call nontendered bonds, or so-called STACs. The theoretical analysis explains the use of STACs and derives conditions under which the call threats embedded in STACs are...

One of the most pervasive aspects of the contemporary financial environment is the rich network of interconnections between firms. Although financial liabilities owed by one firm to another are usually modeled as unidirectional obligations dependent only on the financial health of the issuing...

This paper models the capital structure of a multinational firm. The analysis shows that differences between legal systems in the enforcement of creditor rights, (recently documented by empirical research) can explain the complex mix of parent and subsidiary financing observed in most...

In this paper we develop a framework for examining the effectiveness of boards in controlling self-interested managerial behavior. We show that, even if outside directors are uninformed and are unable to monitor management, they are crucial to implementing efficient corporate policies. Outside...

This paper simulates, via a genetic-learning algorithm, the problems of free-riding and coordination failure when shareholders are confronted with a tender offer bid between pre-and post-takeover firm value. The outcomes produced in the simulations offer qualified support for the hypothesis that...