Accruals and Managerial Operating Decisions Over the Firm Life Cycle

Trading , Voice and Exit over the Firm ’ s Life Cycle ∗

This paper studies the link between public trading and the activity of a firm’s large shareholder (the insider) whose actions can affect firm value. Public trading results in the formation of a price that is informative about the insider’s activity. This in turn increases the latter’s incentives to engage in value increasing activities. Indeed, if the insider has to liquidate (part of) his stak...

Optimal Housing, Consumption, and Investment Decisions over the Life Cycle

We provide explicit solutions to life-cycle utility maximization problems simultaneously involving dynamic decisions on investments in stocks and bonds, consumption of perishable goods, and the rental and the ownership of residential real estate. House prices, stock prices, interest rates, and the labor income of the decision-maker follow correlated stochastic processes. The preferences of the ...

Managerial Overconfidence , Agency Problems , Financing Decisions and Firm Performance

Firm Financing over the Business Cycle

We study the investment and nancing policies of public U.S. rms. Large rms substitute between debtand equity nancing over the business cycle whereas small rms' nancing policy for debt and equity is pro-cyclical. This paper proposes a novel mechanism that explains these cyclical patterns in a quantitative heterogeneous rm industry model with endogenous rm dynamics. We nd that cross-sectional di ...

Firm Financing over the Business Cycle

We study the investment and nancing policies of public U.S. rms. Large rms substitute between debtand equity nancing over the business cycle whereas small rms' nancing policy for debt and equity is pro-cyclical. This paper proposes a novel mechanism that explains these cyclical patterns in a quantitative heterogeneous rm industry model with endogenous rm dynamics. We nd that cross-sectional di ...