Moody’s adjusts a firm’s reported leverage across several dimensions to determine credit ratings. I find that changes to these adjustments affect firm capital structure and investment decisions, especially for firms near the investment grade boundary and with bond covenants containing ratings triggers. Further, in 2006, Moody’s made several changes to its adjustment methodologies. I find that c...

Purpose People’s tendency to overestimate their ability control random events, known as illusion of control, can affect financial decisions under uncertainty. This study developed an artifactual field experiment on for a farm machinery investment. Design/methodology/approach In with two treatments, the individual farmer was either given or not sense over outcome. After each decision, authors el...

This paper investigates how patent applications and grants held by new ventures improve their ability to attract venture capital (VC) financing. We argue that investors are faced with considerable uncertainty and therefore rely on patents as signals when trying to assess the prospects of potential portfolio companies. For a sample of VC-seeking German and British biotechnology companies we have...