Annual Conference

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Corporate Finance

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May 2024

A hedging contract can be terminated by a counterparty when a firm experiences an event of default, such as a credit downgrade, covenant violation, or bankruptcy. We build the model and show that counterparties are more likely to exercise their termination rights when a firm performs poorly and owes...
Keywords: hedging, risk management, derivatives, event of default, distress, basis risk, ISDA
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Annual Conference

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Corporate Finance

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May 2024

Equity pay has become increasingly common over the last several decades but the differences in the level of equity pay across firms are very large. This study documents the inequality in equity pay across firms and describes the drivers of firm-level differences in equity pay policies. We show that ...
Keywords: Equity Compensation, Inequality
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Annual Conference

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Corporate Finance

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May 2024

This paper models strategic voting on ESG proposals by blockholders with heterogeneous reputational concerns and varying levels of commitment to ESG values. ESG activists, whose public-good gains from interven- tion are not attenuated by selling shareholders' free-riding, rationally sponsor even lon...
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Annual Conference

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Corporate Finance

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May 2024

The adoption and commercialization of new technologies rely heavily on universally accepted principles, known as standards. Surprisingly, the role of standards in shaping business outcomes is largely unexplored. This paper provides an initial examination of how the standardization of artificial inte...
Keywords: Artificial Intelligence, Standard Setting, Investment, Technology Diffusion, Machine Learning, Big Data, Ethical AI, AI Safety, Privacy, AI Regulation, RegTech
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2024

Exchange rates in the standard macro-finance model with a representative agent are counter-cyclical. The reason is that exchange rates are equal to the ratio of marginal utilities of consumption of the representative investor in each country. This prediction is counterfactual: across a variety of co...
Keywords: Exchange rates, Incomplete markets, Backus-Smith puzzle
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