We examine the relation between the level of trust in a country and corporate cash holdings.
The precautionary savings motive predicts that firms located in countries with less trusting …

This paper provides empirical evidence that lumpy investment projects provide firms with
the opportunity to adjust leverage at low marginal cost. Consistent with a theoretical model, I …

Funding risk measures the extent to which a fund can borrow money by posting collateral.
Using a novel measure of funding risk based on futures margins, we are able to empirically …

This paper examines how differences in state foreclosure laws influence the incidence of
default in the residential mortgage market. In particular, we examine how judicial review …

This paper investigates the influence of social capital on young firms' financing arrangements.
Using a sample of US start-ups, I find that social capital, as captured by secular norms and …

Dynamic trade off theory suggests that firms let their leverage ratios vary within an optimal
range. I develop an empirical model that estimates how the determinants of capital structure …

Prior research finds a weak relation between cash-flow volatility and leverage. Using a
novel measure of cash-flow volatility, we find that volatility matters more for firms that are …

We propose a Markov chain method for pricing discretely monitored barrier options in both
the constant and time-varying volatility valuation frameworks. The method uses a time …

Priority spreading refers to the practice of firms increasing their reliance on secured and
subordinated debt and reducing their reliance on senior debt as their credit quality deteriorates. …

We examine changes in debt structure when firms experience financial distress. At these
points in time, firms refinance and undergo substantial changes in priority structure. Specifically…