We analyze the nature of financial contracting when an entrepreneur can choose the specificity of investments and financial contracts are incomplete. Investing in projectspecific assets increases productivity but decreases liquidation value. This creates a strategic incentive to specialize assets to decrease the bargaining power of the financier when debt financing is used. By contrast, equity ...

1 Health and Human Development Division, Pan American Health Organization, Washington, D.C., United States of America. Send correspondence to: Rubén M. Suárez-Berenguela, Pan American Health Organization, Health and Human Development Division, 525 23rd Street, N.W., Washington, D.C. 20037-2895, United States of America; telephone: (202) 974-3482; fax: (202) 974-3675; e-mail: suarezru@ paho.org ...

INTRODUCTION China is facing a daunting challenge to health equity in the context of rapid economic development. This study adds to the literature by examining equity in the distribution of high-technology medical equipment, such as CT and MRI, in China. METHODS A panel analysis was conducted with information about four study sites in 2006 and 2009. The four provincial-level study sites inclu...

Based on the principle of individual responsibility and affordability Singapore has developed a unique healthcare model that has produced outstanding health outcomes per dollar spent. Data analysis shows that healthcare financing in Singapore is nevertheless highly dependent on individual income levels despite the presence of substantial government subsidies. Moreover, the key me...

We develop a theory of leveraged buyout (LBO) activity based on two elements: the ability of private equity-owned firms to borrow against their sponsors' reputation with creditors and externalities in sponsors' reputations due to competition and club formation. In equilibrium, the two sources of value creation in LBOs, operational improvements and financing, are complements. Moreover, sponsors ...

General Equilibrium asset pricing models have a difficult time simultaneously delivering a sizable equity premium, a low and counter-cyclical real risk free rate, as well as cyclical variation in return volatility. To explain these stylized facts, this paper introduces occasionally binding financing constraints that impede producers’ ability to invest in an otherwise standard real business cycl...

Despite the wide variety of health care systems in industrialized democracies, a universal paradigm for financing, organization, and macromanagement has been emerging through reforms of the past decade. The policies within this paradigm attempt to promote equity, social efficiency, and consumer satisfaction by combining the advantages of public finance principles--universal access and control o...

The existing literature on law and finance generally assumes that firms are passive recipients of the influence of investor protections on their ability to raise external financing. In this paper, we empirically identify a commitment mechanism, i.e., dividend payouts, which firms use to establish a reputation for better treatment of outside shareholders in order to compensate for country-level ...

The aim of this paper is to provide further insights into the linkages between stock market development and economic growth. When it is not possible to distinguish between investment projects with different rates of return, market valuation of those projects is an “average value” reflecting the expected return across all investment opportunities. Consequently, as in a typical lemon’s market, hi...

BACKGROUND Health reforms in Bulgaria have introduced major changes to the financing, delivery and regulation of health care. As in many other countries of Central and Eastern Europe, these included introducing general practice, establishing a health insurance system, reorganizing hospital services, and setting up new payment mechanisms for providers, including patient co-payments. Our study ex...