Pension plan funding, risk sharing and technology choice
This paper presents a general equilibrium analysis on the interactions between pen- sion plan funding, capital structure, technology choice and the...
Long-term care insurance, annuities and asymmetric information: the case for bundling contracts
Within an asymmetric information set-up in which individuals differ in terms of their risk aversion and can choose whether or not to take preventative...
Incentive design under loss aversion
Compensation schemes often reward success but do not penalize failure. Fixed salaries with stock options or bonuses have this feature. Yet the...
Principal agent problems under loss aversion: an application to executive stock options
Executive stock options reward success but do not penalise failure. In contrast, the standard principal- agent model implies that pay is normally...
The near impossibility of credit rationing
Equilibrium credit rationing in the sense of Stiglitz and Weiss (1981) implies the marginal cost of funds to the borrower is infinite. So borrowers...
Credit Rationing May Involve Excessive Lending
It is typically assumed that equilibrium credit rationing implies insufficient lending. By combining hidden types and hidden action, this paper shows...
Entrepreneurial Wealth, The Level of Investment and Credit Policy
Empirical evidence suggests that capital market constraints prevent low-wealth individuals from setting up in business. This may be attributable to...
Liquidity Shortages and Inefficient Bank Lending
This paper develops a simple model of bank lending and liquidity shortages. Firms borrow from banks in the form of long term renegotiable deposit...
Asymmetric Information and the Trade-Off Between Cash Flow and Net Present Value
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Long-Term Financial Contracts May Mitigate the Adverse Selection Problem in Project Financing
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An Economic Evaluation of Insolvency Procedures in the United Kingdom: Does the 1986 Insolvency Act Satisfy the Creditor's Bargain?
The creditors' bargain view of insolvency law argues that solvency state rights should be preserved in insolvency states. It argues that insolvency...
Credit Markets with Endogenous Project Size and Asymmetric Information; The Case for Interest Rate Taxes
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Asymmetric Information Risk Aversion and Capital Market Efficiency
The Arrow-Lind Theorem is generally interpreted as implying that risk-averse investors will reject some projects that the public sector is justified...
