Financial Volatility and Economic Activity
Does capital markets uncertainty affect the business cycle? We find that financial volatility predicts 30% of post-war economic activity in the United...
Capital Market Theory after the Efficient Market Hypothesis
Have capital market booms and crashes discredited the efficient market hypothesis? This column says yes and suggests a new model that explains asset...
Rents, learning and risk in the financial sector and other innovative industries
We study innovative industries subject to two risks. First, it is uncertain whether the innovation is strong or fragile. Second, it is difficult to...
Regime Switching in Volatilities and Correlation between Stock and Bond markets
This paper studies the correlation and volatilities of the bond and stock markets in a regime- switching bivariate GARCH model. We extend the...
Organizational Diseconomies in the Mutual Fund Industry
I document how the organizational form of a mutual fund affects its investment strategies. I show that centralized funds tilt their portfolios to hard...
Endogenous Liquidity and Contagion
Market liquidity is typically characterized by a number of ad hoc metrics, such as depth, volume, bid-ask spreads etc. No general coherent definition...
Liquidity and Asset Prices A Unified Framework
We examine how liquidity and asset prices are affected by the following market imperfections: asymmetric information, participation costs, transaction...
Negative Nominal Interest Rates:Three ways to overcome the zero lower bound
The paper considers three methods for eliminating the zero lower bound on nominal interest rates and thus for restoring symmetry to domain over which...
Lessons from the global financial crisis for regulators and supervisors
This lecture is a tour d’horizon of the financial crisis aimed at extracting lessons for future financial regulation. It combines normative...
Endogenous Technological Progress and the Cross Section of Stock Returns
I study the cross sectional variation of stock returns and technological progress using a dynamic equilibrium model with production. In the model...
Ambiguity Information Acquisition and Price Swings in Asset Markets
This paper studies asset markets in which ambiguity averse investors face Knightian uncertainty about expected payoffs. The same investors, however...
Large powerful shareholders and cash holding
We study the relationship between liquid asset holding and the pattern of share ownership and control structures within the firm. We explore these...
The lifecycle of the financial sector and other speculative industries
This paper is no longer available, the revised version of this paper can be found as Paul Woolley Centre Paper 4, FMG Discussion Paper 632
The effect of credit rationing on the shape of the competition-innovation relationship
Using a dynamic model of a step-by-step innovation race between financially constrained firms, I study how financial constraints affect innovation...
