Publications

Despite familiar arguments for diversification, many investors choose to hold significant blocks of equity in the same firm. While control benefits may explain majority blocks, most blocks are much smaller than what is generally considered…

This article focuses on the circumstances in which individuals mistakenly assume that their beliefs, perceptions, and feelings differ from those of their peers. Pluralistic ignorance, as this phenomenon is called, yields numerous significant…

The paper by Takatoshi Ito and Weng-Ling Lin (henceforth IL) falls in the general category of market microstructure, which includes the structure of markets, the causes of transaction to transaction price movements, and the way in which…

In this paper we study retail price promotions and manufacturer trade deals in markets with single or multiple product retailers. We find that models that do not account for the existence of retailers overestimate the depth of promotions. In…

This research examines how a market incumbent’s competitive reputation with a potential entrant can deter market entry. The authors develop a psychologically-based set of propositions regarding the antecedents and consequences of an incumbent’s…

The Japan-America Alliances and Partnerships Project has been investigating business alliances and partnerships between U.S. high-technology ventures and Japanese corporations. The purpose of the project is to promote better understanding of the…

This study examines an aspect of competitive interactions that has attracted increasing research attention: the relationship between deterrence and competitive reputations. We build a conceptual model of the antecedents and consequences of a firm…

Using an extensive new data set on U.S. and U.K.-traded closed-end funds, we examine the diversification benefits from emerging equity markets and the extent of their integration with global capital markets. To measure diversification benefits,…

This paper studies a dynamic model of a financial market with some large, strategic traders. These traders are risk-averse and exchange a risky asset for hedging purposes. The only private information in the model concerns their hedging demands.…

A collective goods program, such as an entitlement program distributes benefits and costs according to constituents’ characteristics, and many such programs are outside the appropriations process and continue in effect until changed by future…

Using a framework analogous to models of the term structure of interest rates, an intertemporal rational expectations equilibrium for the term structure of lease rates is developed. While active firms lease existing units of an underlying real…

 This paper aims to contribute to our understanding of financial reporting issues related to environmental liabilities in two ways. First, we investigate whether characteristics known at various points in a Federal Superfund site’s…

Data for a sample of 558 CEOs over 1985-1990 suggest substantial compensation premia for managers of diversified firms. The CEO of a firm with two distinct lines of business averages 10 to 12 percent more in salary and bonus and 13 to 17 percent…

This paper presents a model in which owners choose the optimal mix of tenants. Tenant types are broadly defined to include not only the standard distinctions (office, retail, industrial, residential), but also more subtle distinctions such as the…

Neither men and women nor whites and non-whites are distributed equally across occupations. This inequality by gender or race is termed occupational segregation. Occupational segregation by gender is of greater magnitude and has been more…

This paper studies contracting between a principal, a prime contractor, and a subcontractor when both the prime contractor and the subcontractor have private information about their own costs of producing complementary inputs. Side-contracting…

In the past few decades, a number of alternative media and promotion options have emerged by which marketers can communicate to consumers. A modern marketing communications program might consist of television, radio, magazine, and newspaper…

We present a new methodology for studying the problem of intrafirm bargaining, based on the notion that contracts cannot commit the firm and its agents to wages and employment. In particular, we analyze a general bargaining game between the firm…