Upcoming FTG Events

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35th Meeting at Carnegie Mellon University (Fall 2026)

25

Sep

35th Meeting at Carnegie Mellon University (Fall 2026)


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From: September 25, 2026 - To: September 26, 2026

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Carnegie Mellon University

The 35th FTG Member Meeting will take place at Carnegie Mellon University on September 25–26, 2026. The local...

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3rd Asian FTG Conference

10

Dec

3rd Asian FTG Conference


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From: December 10, 2026 - To: December 11, 2026

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Hong Kong University

The 3rd Annual Finance Theory Group Winter Conference will be held at The University of Hong Kong on...

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36th Meeting at UT Dallas (Spring 2027)

07

May

36th Meeting at UT Dallas (Spring 2027)


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From: May 7, 2027 - To: May 8, 2027

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UT Dallas

Details will be available soon.

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Featured Papers

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This paper presents a dynamic model of firm financing where firms use financial slack to reduce rent extraction by financiers with bargaining power. Financing is lumpy because it is optimal to bargain infrequently. Moreover, firms may finance ‘early’ before exhausting internal funds to bargain when their outside options are better....


We study information sales in financial markets with strategic risk-averse traders. Our main result establishes that the optimal selling mechanism is one of the following two: (i) sell to as many agents as possible very imprecise information; (ii) sell to a single agent a signal as precise as possible. As...


We model the dynamic competition among national fiat currencies, cryptocurrencies, and Central Bank Digital Currencies (CBDCs), whereby countries strategically digitize their currency and launch CBDC in response to competition from emerging cryptocurrencies and other currencies. Countries with strong but non-dominant currencies benefit the most from launching CBDC early on. The...

Finance Theory Insights

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Issue 10 (September 2026)

Finance Theory Insights

Issue 10 (September 2026)

Benefits of Coordination and Consequences of Coordination Failures

Logo Finance Theory Group

One of the central themes in corporate finance concerns the benefits of coordination and the consequences of coordination failures. Such trade-offs influence many important aspects of corporate decision-making, such as the failure of firms, incentives to engage in activism, and the compensation of senior executives. A key channel through which they operate is the underlying contractual setting confronting firms.

 

For example, two of the papers in this issue address trade-offs involving the failure of firms. “Filing for Bankruptcy Early Can Keep a Firm Alive Longer” highlights the incentive for creditors to run and how automatic stay provisions after a bankruptcy filing, as well as clawback provisions, influence decisions prior to bankruptcy. The automatic stay increases the post-bankruptcy payoff to discourage running prior to bankruptcy, while clawback provisions also weaken the incentive to run. Hence, bankruptcy rules can affect the timing of bankruptcy. “The Hidden Logic of Letting Firms Fail” focuses on the fire-sale externality among banks and how reorganization affects others. Whether one should encourage liquidation or, alternatively, discourage it—as illustrated by the eviction moratorium that arose during COVID-19—depends upon the health of the banks. There can be competing externalities in a crisis due to differences in bank collateral constraints. Under some conditions, liquidation should be subsidized, while under others it should be taxed.

 

“Leader-Follower Dynamics in Shareholder Activism” examines situations in which there is “wolf pack activism,” in which blockholders coordinate actions tacitly. A larger stake held by one activist can incentivize other holders to accumulate additional shares, even without explicit coordination. Finally, “Too Much, Too Soon, for Too Long: Why Competition Alone Cannot Fix CEO Pay” examines how the market for executive compensation can systematically produce overcompensation due to spillovers related to punishment in the marketplace. This suggests a rationale for noncompete clauses that restrict an executive’s outside option.

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September 1, 2026

10th Issue of FT Insights


We are pleased to announce that the 10th Issue of FT Insights is now available. This issue explores...

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May 9, 2026

2026 Best JMP Prize Winners


We are pleased to announce the recipients of the 2026 FTG Best Theory Job Market Paper Prize.Winner: Hanjoon...

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April 14, 2026

2026 New Members


The FTG is pleased to welcome our new members:Alex Maciocco (UC Irvine → Indiana), Alexander Ober (Rice), Elu...

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Working Paper Series

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