This paper investigates the strategic foundations for rational expectations equilibrium. In the model, risk-averse traders with two signals—private information and... Read More
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Firms often choose to raise capital from multiple creditors even though doing so may lead to inefficient liquidation caused by... Read More
Share repurchases naturally emerge in a repeated Myers and Majluf's world. Some firms strictly profit from the repurchase transaction. Some... Read More
Published: Volume 29, Issue 6, pages 1409-1452, Review of Financial Studies
We model financial innovations such as Exchange-Traded Funds, smart beta products, and many index-based vehicles as composite securities that facilitate... Read More
We model a dynamic economy with strategic complementarity among investors and endogenous government interventions that mitigate coordination failures. We establish... Read More