Cleansing by Tight Credit: Rational Cycles and Endogenous Lending Standards
Endogenous cycles are generated by the two-way interaction between lenders’ behavior in the credit market and production fundamentals. When lenders...
The new global tax deal arrives (but expect bumps ahead)
Nearly 140 countries have agreed to a new global tax deal, which was years in the making. Estonia, Hungary and Ireland, the last holdouts, joined the...
Simpler approaches to a global tax plan
More than 130 countries have lined up in favour of a global redesign of corporate taxes. The redesign calls for multinational giants to pay their...
Changing bankruptcy law has given firms time to adapt and recover
Bankruptcies are costly, but economists worry about keeping doomed firms alive. Simeon Djankov (LSE) argues that restructuring bankruptcy laws has...
Gendered laws curb Olympic success
Legal gender equality is key for female participation in the labour market. The association between women’s legal empowerment and success in sports is...
When Zombie Firms Become a Worry, Revise Bankruptcy Laws
Bankruptcies have fallen sharply in OECD economies during 2020 and the first half of 2021 because of an array of COVID-related support available to...
Information, Market Power and Welfare
We study a financial market in which agents with interdependent values bid for a risky asset. Some agents are privately informed of their own value...
Network Risk and Key Players: A Structural Analysis of Interbank Liquidity
Journal of Financial Economics, 141(3), 831-859
Why we don’t write more papers on political finance
Despite the commonly held views of economists on regulatory capture, our profession has been much more hesitant in recognising similar conflicts of...
Rebooting UK financial regulation for the post-Brexit world
Recognising the critical role that financial markets will play in the success of the UK’s post-Brexit economy, the Treasury is now engaged in a review...
The Wall Street Stampede: Exit as Governance with Interacting Blockholders
The growth of the asset management industry has made it commonplace for firms to have multiple institutional blockholders. In such firms, the strength...
Margin Trading and Leverage Management
We use granular data covering regulated (brokerage-financed) and unregulated (shadow-financed) margin trading during the 2015 market turmoil in China...
Why Don’t Most Mutual Funds Short Sell?
An intriguing observation in the US mutual fund industry is that most equity funds do not short sell, even though virtually all regulatory...
