Finance

By Anat Admati and Martin Hellwig An edited version of the following text appeared as an op-ed in Financial Times, June 3, 2011. Full text version appeared online in "Martin Wolf's Economists' Forum," FT.com, June 6, 2011. Bankers on both sides of the Atlantic are lobbying furiously against...
STANFORD GRADUATE SCHOOL OF BUSINESS—Overconfident CEOs who overestimate their ability to generate value within their company systematically make distorted decisions about when, how, and how much to invest in new projects according to research. Ulrike Malmendier, assistant professor of finance at...
STANFORD GRADUATE SCHOOL OF BUSINESS—In June finance ministers of the Group of 8, the world's wealthiest industrialized nations, agreed to cancel at least $40 billion in debt owed by the world's poorest nations, many of them in Africa. The move certainly sounds generous, but researchers caution it...
STANFORD GRADUATE SCHOOL OF BUSINESS—When Fox decided to make the movie Titanic, the studio called upon Paramount to put up $65 million to help finance the film in exchange for a portion of profits and movie rights. Fox covered its derriere by sharing risk for the picture through the co-financing...
Kenneth Singleton
It was the wildest of wild rides. In mid-January of 2007, crude oil futures on the NYMEX Exchange closed at $52 a barrel. Eighteen months later, a relentless climb had pushed prices to an all-time, inflation-adjusted high of $145 a barrel. World markets panicked, and analysts predicted that we'd...
STANFORD GRADUATE SCHOOL OF BUSINESS—Saving for retirement is hard enough. It turns out, though, that spending intelligently during retirement is difficult as well. The soon-to-be-retired person has to make a range of decisions about spending that will have real consequences for as long as he or...
STANFORD GRADUATE SCHOOL OF BUSINESS—High-profile legal cases, alleging misconduct by executives at Countrywide Savings, Novatel, and Qwest, may be prompting the Securities and Exchange Commission to rethink rules that permit scheduled trading by insiders.  One catalyst for this second look is...
STANFORD GRADUATE SCHOOL OF BUSINESS—Manufacturing philosophy has undergone a revolution in the past few decades emphasizing continuous improvement, low-inventory techniques, and increased collaboration, cross-training, and problem-solving by workers. In the 1990s, the American economy steadily...
STANFORD GRADUATE SCHOOL OF BUSINESS—Imagine this scenario: Two households with stock portfolios of identical worth each see their investments appreciate by 10 percent one year. The only difference is that one household’s wealth grows entirely through capital gains; the other receives its...
Your grandmother’s habit of hoarding pennies in a jar notwithstanding, until now there’s been no hard evidence that economic events like the Great Depression actually change investment behavior. A study by Stefan Nagel and Ulrike Malmendier, however, stands conventional economic wisdom on its head...

Pages