Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 2 of 2
Full-Text Articles in Finance
Mergers And Ceo Power, Felipe Balmaceda Assoc Prof.
Mergers And Ceo Power, Felipe Balmaceda Assoc Prof.
Felipe Balmaceda
In this paper I propose a model of mergers in which synergies and CEO power play a crucial role. A merger is modeled as a bargaining game between the acquiring and target board of directors with the gains from a merger divided according to the generalized Nash-bargaining solution. The model's implications are consistent with the available empirical evidence on stock returns, and yield some new untested implications that are mainly related to the relationship between CEO power, cor- porate governance and mergers. Finally, the model sheds light on the relationship between aggregate merger activity, synergies and CEO power. (JEL: G34, …
Economic Performance, Creditor Protection, And Labour Inflexibility, Felipe Balmaceda Assoc Prof., Ronald Fischer Full Professor
Economic Performance, Creditor Protection, And Labour Inflexibility, Felipe Balmaceda Assoc Prof., Ronald Fischer Full Professor
Felipe Balmaceda
We present a static general equilibrium model of an open economy where agents are heterogeneous in terms of observable wealth and there are endogenous credit constraints due to imperfect creditor protection. Improved credit protection, harder assets, and more efficient bankruptcy procedures increase output, investment, and credit penetration. Better credit protection and harder assets lead to higher interest rate spreads. In a capital constrained (unconstrained) economy, greater (lower) wealth inequality leads to higher (lower) investment and output. Interest rate spreads are lower in richer and more unequal economies in terms of their wealth distribution. We also show that increased labour protection …