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Handbook of the Economics of Finance

Book Description

In the 11 articles in this first of two parts, top scholars summarize and analyze recent scholarship in corporate finance.  Covering subjects from corporate taxes to behavioral corporate finance and econometric issues, their articles reveal how specializations resonate with each other and indicate likely directions for future research. By including both established and emerging topics, Volume 2 will have the same long shelf life and high citations that characterize Volume 1 (2003).



  • Presents coherent summaries of major finance fields, marking important advances and revisions
  • Describes the best corporate finance research created about the 2008 financial crises
  • Exposes readers to a wide range of subjects described and analyzed by the best scholars

Table of Contents

  1. Cover image
  2. Title page
  3. Table of Contents
  4. Copyright
  5. Introduction to the Series
  6. Preface
  7. VOLUME2A Corporate Finance
    1. Chapter 1. Securitization
      1. 1 Introduction
      2. 2 Securitization: Some Institutional Details
      3. 3 Overview of the Performance of Asset-Backed Securities
      4. 4 A Simple Model of the Securitization Decision
      5. 5 The Origins of Securitization
      6. 6 Security Design and the Cost of Capital: Theory
      7. 7 Security Design and the Cost of Capital: Evidence
      8. 8 Securitization, Regulation, and Public Policy
      9. 9 Final Comments and Open Questions
      10. References
    2. Chapter 2. Dynamic Security Design and Corporate Financing
      1. 1 Introduction
      2. 2 Informational Problems in Static Models
      3. 3 Simple Securities in Dynamic Models
      4. 4 Optimal Dynamic Security Design under Moral Hazard
      5. 5 Asymmetric Information in Dynamic Settings
      6. References
    3. Chapter 3. Do Taxes Affect Corporate Decisions? A Review
      1. 1 Introduction
      2. 2 Taxes and Capital Structure—The US Tax System
      3. 3 Taxes and Capital Structure—Multinational Tax Issues
      4. 4 Taxes, LBOs, Corporate Restructuring, and Organizational Form
      5. 5 Taxes and Payout Policy
      6. 6 Taxes and Compensation Policy
      7. 7 Taxes, Corporate Risk Management, and Earnings Management
      8. 8 Tax Shelters
      9. 9 Summary and Suggestions for Future Research
      10. References
    4. Chapter 4. Executive Compensation: Where We Are, and How We Got There
      1. 1 Introduction
      2. 2 Where We are: A Primer on Executive Compensation
      3. 3 How We Got There: A Brief History of CEO Pay
      4. 4 International Comparisons: Are US CEOs Still Paid More?
      5. 5 Towards a General Theory of Executive Compensation
      6. References
    5. Chapter 5. Behavioral Corporate Finance: An Updated Survey
      1. 1 Introduction
      2. 2 Market Timing and Catering
      3. 3 Managerial Biases
      4. 4 Behavioral Signaling
      5. 5 Some Open Questions
      6. References
    6. Chapter 6. Law and Finance After a Decade of Research
      1. 1 Introduction
      2. 2 Background on Legal Origins
      3. 3 Some Evidence
      4. 4 Explaining the Facts
      5. 5 Legal Origins and Culture
      6. 6. Legal Origins and Politics
      7. 7 Legal Origins and History
      8. 8 Conclusion
      9. References
    7. Chapter 7. Endogeneity in Empirical Corporate Finance
      1. 1 Introduction
      2. 2 The Causes and Consequences of Endogeneity
      3. 3 Instrumental Variables
      4. 4 Difference-in-Differences Estimators
      5. 5 Regression Discontinuity Design
      6. 6 Matching Methods
      7. 7 Panel Data Methods
      8. 8 Econometric Solutions to Measurement Error
      9. 9 Conclusion
      10. References
    8. Chapter 8. A Survey of Venture Capital Research
      1. 1 Introduction
      2. 2 Data Sources and Methodology for Empirical Research
      3. 3 Venture Capital Investments in Entrepreneurial Companies
      4. 4 The Analysis of Venture Capital Firms
      5. 5 Returns to Venture Capital Investments
      6. 6 Venture Capital and the Economy
      7. 7 Conclusion
      8. References
    9. Chapter 9. Entrepreneurship and the Family Firm
      1. 1 Creative Destruction and the Family Firm
      2. 2 The Succession Decision
      3. 3 Economic Development and the Family Firm
      4. 4 The Importance of Oligarchs
      5. 5 Schumpeter and Chandler, Reconciled?
      6. References
    10. Chapter 10. Financing in Developing Countries
      1. 1 Introduction
      2. 2 Stylized Facts About Firms in Developing Countries
      3. 3 Firms in Developing Countries—Theories and Empirical Research Issues
      4. 4 Institutions and Access to Finance in Developing Countries
      5. 5 Firm Financing in Developing Countries
      6. 6 Bank-based Versus Market-based Systems
      7. 7 Formal and Informal Systems
      8. 8 Conclusion
      9. References
    11. Chapter 11. Financial Intermediation, Markets, and Alternative Financial Sectors
      1. 1 Introduction
      2. 2 State of the Financial System and Firms’ Financing Channels
      3. 3 Firms’ Financing Channels: The Role of Alternative Finance
      4. 4 Comparing Traditional and Alternative Financial Sectors
      5. 5 Concluding Remarks
      6. References
  8. Index