Open Access. Powered by Scholars. Published by Universities.®

Corporate Finance Commons

Open Access. Powered by Scholars. Published by Universities.®

Articles 1 - 16 of 16

Full-Text Articles in Corporate Finance

Event-Based Biotechnology Stock Price Movement: Valuing Success And Failure In Biotechnology Product Development, Faris Sumadi May 2016

Event-Based Biotechnology Stock Price Movement: Valuing Success And Failure In Biotechnology Product Development, Faris Sumadi

Honors College Theses

Biotechnology investment, in the second quarter of 2015, hauled in a record $2.3 billion worth of venture capital. The 126 deals struck marked the biggest quarterly investment (up 32% from the prior quarter) since reporting started in 1995. With $3.8 billion invested in these pre-IPO ventures by mid-2015, the biotech industry soared past the $6 billion of venture capital cash invested in 2014. These numbers illustrate how early-stage research, with unproven science, has been revived after a decade of VCs shying away. Out of the $2.3 billion raised in Q2, $1.5 billion went to early-stage companies while $733 million went …


Common Sense And Civic Virtue: Institutional Investors, Responsible Ownership, And The Democratic Ideal, Marcy Murninghan Mar 2013

Common Sense And Civic Virtue: Institutional Investors, Responsible Ownership, And The Democratic Ideal, Marcy Murninghan

New England Journal of Public Policy

On matters of governance, the people’s good is the highest law, as Cicero said two millennia ago. Unfortunately, these days personal greed has trumped the people’s good, enflaming the current governance crisis affecting our public, nonprofit, and private spheres. The spate of corporate governance scandals over the past several years jeopardizes equity investments, harms beneficiaries, and weakens global capital markets. The remedy is not just more laws and regulation but revitalization of the system of corporate checks and balances that already exists. To get better corporate governance, corporate shareowners, especially institutional investors, need to assert their rights and responsibilities more …


Corporate Financial Strategy, Arindam Bandopadhyaya, Kristen Callahan, Yong-Chul Shin Feb 2012

Corporate Financial Strategy, Arindam Bandopadhyaya, Kristen Callahan, Yong-Chul Shin

Financial Services Forum Publications

No abstract provided.


Credit Gap In Small Businesses: Some New Evidence, Atreya Chakraborty Jan 2012

Credit Gap In Small Businesses: Some New Evidence, Atreya Chakraborty

Accounting and Finance Faculty Publication Series

What is the magnitude of credit constraint affecting small businesses? This paper provides estimate of the credit gap – defined as the difference between the desired and actual levels of debt for credit constrained small businesses. The estimated credit gap is approximately 20 percent, i.e., credit constrained small business on the average would desire 20 percent more debt. This credit gap varies considerably across industries, with manufacturing firms facing a significantly larger gap than firms in the wholesale or service industries.


A Metric And Topological Analysis Of Determinism In The Crude Oil Spot Market, Atreya Chakraborty Jan 2012

A Metric And Topological Analysis Of Determinism In The Crude Oil Spot Market, Atreya Chakraborty

Atreya Chakraborty

We test whether the spot price of crude oil is determined by stochastic rules or exhibits deterministic endogenous fluctuations. In our analysis, we employ both metric (correlation dimension and Lyapunov exponents) and topological (recurrence plots) diagnostic tools for chaotic dynamics. We find that the underlying system for crude oil spot prices (i) is of high dimensionality (no stabilization of the correlation dimension), (ii) does not exhibit sensitive dependence on initial conditions, and (iii) is not characterized by the recurrence property. Thus, the empirical evidence suggests that stochastic rather than deterministic rules are present in the system dynamics of the crude …


Credit Gap In Small Businesses: Some New Evidence, Atreya Chakraborty Jan 2012

Credit Gap In Small Businesses: Some New Evidence, Atreya Chakraborty

Atreya Chakraborty

What is the magnitude of credit constraint affecting small businesses? This paper provides estimate of the credit gap – defined as the difference between the desired and actual levels of debt for credit constrained small businesses. The estimated credit gap is approximately 20 percent, i.e., credit constrained small business on the average would desire 20 percent more debt. This credit gap varies considerably across industries, with manufacturing firms facing a significantly larger gap than firms in the wholesale or service industries.


The Importance Of Being Known: Relationship Banking And Credit Limits, Atreya Chakraborty Jan 2011

The Importance Of Being Known: Relationship Banking And Credit Limits, Atreya Chakraborty

Accounting and Finance Faculty Publication Series

This paper measures the importance of bank-firm relationships in obtaining higher credit “limits.” We use data from a relatively unused section of the National Survey of Small Business Finance (NSSBF, 1993) on credit limits, credit sources, and contract terms for firms with lines of credit from multiple banks. This lets us isolate the credit limit that each bank provides the same firm, eliminating the need to control for often immeasurable, unreliable, or firm-specific “soft” information. For a median Line of Credit (LOC) of $250,000, we find that a bank with a five-year information advantage provides a LOC limit that is …


The Impact Of Macroeconomic Uncertainty On Firms Changes In Financial Leverage, Atreya Chakraborty Jan 2010

The Impact Of Macroeconomic Uncertainty On Firms Changes In Financial Leverage, Atreya Chakraborty

Accounting and Finance Faculty Publication Series

We investigate the relationship between a firm’s measures of corporate gov- ernance, macroeconomic uncertainty and changes in leverage. Recent research highlights the role of governance in financing decisions. Previous research also indicates that macroeconomic uncertainty affects a firm’s ability to borrow. In this paper we investigate how both these channels of influence affects firms’ financing decisions. Our findings show that macroeconomic uncertainty has an important role to play, both by itself and in interaction with a measure of corporate governance.


Antitakeover Amendments And Managerial Entrenchment: New Evidence From Investment Policy And Ceo Compensation, Atreya Chakraborty, Shahbaz Sheikh Jan 2010

Antitakeover Amendments And Managerial Entrenchment: New Evidence From Investment Policy And Ceo Compensation, Atreya Chakraborty, Shahbaz Sheikh

Atreya Chakraborty

We explore the relation between antitakeover amendments and firm investment in long-term assets. Empirical results indicate that an increase in the G-index of Gompers et al. (2003) is associated with less investment in R&D and reduced capital expenditures. These results suggest that protection from takeover threat increases managerial entrenchment and results in underinvestment. We also find that this increased entrenchment is associated with higher total and cash compensation and fewer performance incentives for managers, suggesting that protected managers influence their own pay. These results are robust to a number of robustness checks and remain significant after controlling for industry effects. …


The Relationship Between Incentive Compensation And Forced Ceo Turnover, Atreya Chakraborty, Shahbaz Sheikh, Narayanan Subramanian Jul 2009

The Relationship Between Incentive Compensation And Forced Ceo Turnover, Atreya Chakraborty, Shahbaz Sheikh, Narayanan Subramanian

Atreya Chakraborty

We study the relationship between incentive compensation and performance related CEO turnover. Our theoretical model predicts that the slope of the compensation contract and forced turnover may be complements. Our results support this prediction. We find that incentives and turnover are positively related. This relationship however, varies with the equity ownership of CEOs and does not hold for CEOs who own more than 5% equity. Moreover, this relationship is stronger if the firm under performs its industry. Our results suggest that high-powered incentives may increase the signaling power of performance measures and lead to higher likelihood of turnover.


Golden Parachutes And Shark Repellents And Shareholders' Interests: Some New Evidence, Atreya Chakraborty Jan 2008

Golden Parachutes And Shark Repellents And Shareholders' Interests: Some New Evidence, Atreya Chakraborty

Atreya Chakraborty

In this paper we test for the motives for adopting golden parachutes and Anti-Takeover Amendments (ATAs). Firms that exhibited financial characteristics that were associated with a greater probability of hostile raids were also more likely to adopt golden parachutes or ATAs. We also find evidence to support the hypothesis that the adoption of golden parachutes and poison pills may in fact complement each other.


Repricing And Executive Turnover, Narayanan Subramanian, Atreya Chakraborty, Shahbaz Sheikh Feb 2007

Repricing And Executive Turnover, Narayanan Subramanian, Atreya Chakraborty, Shahbaz Sheikh

Atreya Chakraborty

We examine whether the threat of executive turnover faced by a firm affects its decision to reprice stock options held by its executives. We estimate a model of voluntary turnover among top executives and show that the predicted turnover from this model is positively related to the probability of repricing. The relationship is robust to the inclusion of several known determinants of repricing. Our results are consistent with a model in which a tight labor market makes executives hard to replace, forcing firms to reprice stock options when they go underwater.


Risk Sharing And The Market For Corporate Control: A Case For Golden Parachutes, Atreya Chakraborty Jan 2004

Risk Sharing And The Market For Corporate Control: A Case For Golden Parachutes, Atreya Chakraborty

Accounting and Finance Faculty Publication Series

The predictability of security returns has received considerable attention in the literature, and yet the predictability of bond returns beyond the US markets has remained far less explored. Here we plan to remedy the shortcoming, and in that effort we analyse the ability of several predetermined information variables in predicting bond returns in the European market. We test if variables, commonly used for that matter in the context of other markets (such as inverse relative wealth, term spread, real bond yield and a January dummy) are also useful predictors of European bond returns. Due to some particularities of the sample …


Persistent Dependence In Foreign Exchange Rates? A Reexamination, Atreya Chakraborty Jan 2004

Persistent Dependence In Foreign Exchange Rates? A Reexamination, Atreya Chakraborty

Atreya Chakraborty

We test for stochastic long-memory behavior in the returns series of currency rates for eighteen industrial countries using a semiparametric fractional estimation method. A sensitivity analysis is also carried out to analyze the temporal stability of the longmemory parameter. Contrary to the findings of some previous studies alluding to the presence of long memory in major currency rates, our evidence provides wide support to the martingale model (and therefore for foreign exchange market efficiency) for our broader sample of foreign currency rates. Any inference of long-range dependence is fragile, especially for the major currency rates. However, long-memory dynamics are found …


Common Sense And Civic Virtue: Institutional Investors, Responsible Ownership, And The Democratic Ideal, Marcy Murninghan Mar 2003

Common Sense And Civic Virtue: Institutional Investors, Responsible Ownership, And The Democratic Ideal, Marcy Murninghan

New England Journal of Public Policy

On matters of governance, the people’s good is the highest law, as Cicero said two millennia ago. Unfortunately, these days personal greed has trumped the people’s good, enflaming the current governance crisis affecting our public, nonprofit, and private spheres. The spate of corporate governance scandals over the past several years jeopardizes equity investments, harms beneficiaries, and weakens global capital markets. The remedy is not just more laws and regulation but revitalization of the system of corporate checks and balances that already exists. To get better corporate governance, corporate shareowners, especially institutional investors, need to assert their rights and responsibilities more …


Marketing Strategy And The Use Of Information Technology: New Evidence From The Trucking Industry, Atreya Chakraborty Jan 2001

Marketing Strategy And The Use Of Information Technology: New Evidence From The Trucking Industry, Atreya Chakraborty

Atreya Chakraborty

Since the mid-1980s, many authors have investigated the influence of information technology (IT) on productivity. Until recently there has been no clear evidence that productivity increases as a result of IT spending. This productivity paradox is partly due to the difficulty in correctly identifying outputs, particularly in a service sector such as the trucking industry. Products are often differentiated by quality attributes of the service provided, rather than merely the physical content of the good delivered by motor carriers. A carrier's primary marketing objective, e.g. on-time performance vs. lowest-rate carrier, is precisely what differentiates a trucking firm's service. This paper …