Tag Archives: Economics

Propagation of Climate Disasters Through Ownership Networks

By | March 7, 2024

Climate risk is one of the greatest challenges facing the world today and investors are taking notice.  But a full understanding of how climate risks get implemented into firm policy remains elusive. In our recent paper, we study the propagation of climate disasters through common ownership networks as a mechanism through which investors may impact… Read More »

Common Investor Relations Representation 

By | March 5, 2024

Publicly listed corporations in the US typically have investor relations (IR) programs that involve providing information to and interfacing with external firm stakeholders. IR encompasses various activities, including preparing and issuing corporate disclosures, managing relationships with current and prospective investors, organizing non-deal roadshows to improve visibility with the street, interfacing with sell-side analysts to evaluate… Read More »

Understanding Corporate Tax Audits: Insights from Novel Firm-Level Data 

By | March 4, 2024

In the complex realm of corporate taxation, tax audits play a crucial role in influencing how companies deal with their tax planning strategies. The influence of these audits is substantial, yet a comprehensive understanding of their economic implications remains elusive, primarily due to the lack of detailed public data. Although tax audits are inherently negative… Read More »

Can Elon Musk’s SpaceX Raise More Equity Capital Without Going Public?

By | January 25, 2024

Elon Musk’s SpaceX, a pioneering company in reusable rockets and spacecraft design, continues to rank as one of the most valuable private companies in the world. According to Bloomberg, its valuation nears 180 billion dollars, over 100 times that of a “unicorn”— a private company that is valued at over one billion dollars. To date,… Read More »

Regulatory Transparency and Regulators’ Effort: Evidence from Public Release of the SEC’s Review Work 

By | January 18, 2024

Regulators face near-zero competition and exit threats. Thus, agency problems are more likely to occur when information asymmetry exists between regulators and constituents (Stiglitz 1999; Coffee 2007). If information asymmetry exacerbates moral hazard in the regulatory context, then the question is whether regulatory transparency can reduce moral hazard and improve regulator accountability. After all, regulators… Read More »

How can tax rules shape the global market for corporate control and overall economic growth? The case of anti-loss trafficking rules

By | January 17, 2024

2021 saw a remarkable surge in the global market for corporate control, with a record number of 65,000 mergers and acquisitions (M&A). Among other factors, tax rules play an important role in shaping the probability and structure of M&A transactions. In 2008, the temporary suspension of limitations on tax loss transfers led to a substantial… Read More »

Regulating Choice Architecture with Behavioral Audits

By | January 16, 2024

Regulation of behavioral science is coming. The Biden Administration has committed to tackling “junk fees” which emerge from deceptive, online behavioral design practices, as has the Federal Trade Commission. In the UK, the Competition and Markets Authority (CMA) is increasingly concerned with harms arising from ‘behavioral design’ and ‘choice architecture’. So too is the European… Read More »

Talk vs. Walk: Lessons from Silent Sustainable Investing of Mutual Funds 

By | January 12, 2024

In response to the escalating demand for sustainable investment options, the mutual fund industry is actively integrating sustainability into investment strategies and has introduced numerous financial products focused on sustainable investing. Consequently, mutual funds in capital markets can generally be categorized into two groups: self-identified ESG funds and non-ESG funds. Notably, over 70% of the… Read More »

Financing Green Transition: Bank-Nonbank Partnership  

By | January 11, 2024

At their current levels, sustainable investments are considerably below the levels needed to achieve decarbonization and the targets of the Paris Agreement. The World Economic Forum suggests that, to meet these goals, investments in nature-based solutions must quadruple by 2050, resulting in an annual investment exceeding $536 billion. Several strategies have been proposed, emphasizing the… Read More »

Non-Financial Liabilities and Effective Corporate Restructuring 

By | December 14, 2023

The system for managing corporate insolvency varies in fundamental ways between countries, with important effects on economic outcomes. Chapter 11 of the U.S. Bankruptcy Code forms the legal basis of the successful American regime, which can handle distress in a formal process without liquidating assets, closing businesses, and with limited job losses. Many countries aim… Read More »