Publications

2020
Working Paper

Corporate Leadership and Creditor Recovery Rates: Evidence from Executive Gender

By: Clarissa Hauptmann, Syrena Shirley and Anywhere Sikochi

We examine the relationship between the gender of executives and corporate creditor recovery rates. Using 2,288 defaulted debt instruments, we find that female executives are associated with higher creditor recovery rates. Our findings are robust to tests that correct... View Details

Keywords: Executive Gender; Default; Recovery Rates; Debt; Corporate Bonds; Conservatism; Leadership; Gender; Borrowing and Debt; Bonds; Risk Management

2022
Working Paper

The Transformation of Self Employment

By: Innessa Colaiacovo, Margaret Dalton, Sari Pekkala Kerr and William R. Kerr

Over the past half-century, while self-employment has consistently accounted for around one in ten of the United States workforce, its composition has changed. Since 1970, industries with high startup capital requirements have declined from 53% of self-employment to... View Details

Keywords: Self-employment; Startup Investment; Occupational Choice; Financing; Small Business; Entrepreneurship; Business Startups; Financing and Loans

SSRN

September 2017
Article

The Real Effects of Capital Controls: Firm-Level Evidence from a Policy Experiment

By: Laura Alfaro, Anusha Chari and Fabio Kanczuk

Emerging-market governments adopted capital control taxes to manage the massive surge in foreign capital inflows in the aftermath of the global financial crisis. Theory suggests that the imposition of capital controls can drive up the cost of capital and curb... View Details

Keywords: Capital Controls; Discriminatory Taxation; International Investment Barriers; Exports; Debt; Cost of Capital; Taxation; Investment; Borrowing and Debt; Equity; Brazil

December 2012 (Revised January 2015)
Technical Note

Early Career LBOs Using the Search Fund Model

By: Howard Stevenson, Michael Roberts and Jim Sharpe

The funded search model is one alternative for individuals who, at some point in their career, want to run their own companies. This note looks at the funded search, as a means to entrepreneurship through acquisition and describes the path to buy and run a business... View Details

Keywords: Search Funds; Search; Entrepreneurial Finance; Investor Behavior; Career Planning; Entrepreneurial Management; Fundraising; Negotiation; Entrepreneurship; Capital Structure; Borrowing and Debt; Personal Development and Career; Private Ownership; Acquisition; Finance; Leveraged Buyouts

December 2012
Background Note

Jefferson County: Specific Swap Detail

Jefferson County, Alabama, faces an EPA mandate requiring sewer system upgrades. How will they finance the upgrades? What consequences will follow? View Details

Keywords: Local Government; Political Process; Bankruptcy; Debt Management; Financial Planning; Financial Management; Urban Development; City; Infrastructure; Government and Politics; Alabama

2016
Working Paper

Credit Migration and Covered Interest Rate Parity

By: Gordon Y Liao

I document economically large and persistent discrepancies in the pricing of credit risk between corporate bonds denominated in different currencies. The discrepancies amount to 50-100 basis points on trillions of dollars of debt notional. I relate this violation of... View Details

Keywords: Market Segmentation; Debt Issuance; Covered Interest Rate Parity; Cross-currency Basis; Credit Risk; Financial Markets; Credit

June 2014
Article

Frictions in Shadow Banking: Evidence from the Lending Behavior of Money Market Funds

By: Sergey Chernenko and Adi Sunderam

We document the consequences of money market fund risk taking during the European sovereign debt crisis. Using a novel data set of security-level holdings of prime money market funds, we show that funds with large exposures to risky Eurozone banks suffered significant... View Details

Keywords: Money Market Mutual Funds; European Sovereign Debt Crisis; Runs; Contagion; Risk Taking; Investment Funds; Financial Crisis; Europe

August 2014 (Revised March 2015)
Case

Molycorp: Issuing the 'Happy Meal' Securities (B)

By: Benjamin C. Esty and E. Scott Mayfield

Molycorp, the Western hemisphere's only producer of rare earth minerals, was in the middle of a $1 billion capital expansion in its effort to become a vertically integrated supplier of rare earth minerals, oxides, and metals. After reporting lower than expected... View Details

December 2012 (Revised May 2014)
Case

Hotel Ivory

By: Arthur I Segel, Nicolas P. Retsinas and Jonathan Lo

Cheick Sanankoua is an MBA student who believes that he has found the perfect investment property, a small, independently owned hotel, on the Ivory Coast. However, he has had trouble raising money for the investment beyond friends and family. Through contacts in the... View Details

Keywords: Real Estate; Emergent Countries; Investing; Entrepreneurial Finance; Debts; Cash Flow; Quantitative Analysis; Financing; Development Stage Enterprises; Small ＆ Medium-sized Enterprises; Africa; Ivory Coast; Venture Capital; Emerging Markets; Property; Investment; Accommodations Industry; Real Estate Industry; Africa

October 2014 (Revised February 2017)
Case

A Currency We Can Call Our Own: Populism, Banking Crises, and Exchange Rate Crises in Argentina, 1946–2002

By: Rafael Di Tella

The case describes Argentina's struggle to establish a credible monetary system under populist pressures and the recurrent use of exchange rate stabilization plans. It focuses on two episodes where there was "too little money" in the economy: during the hyperinflation... View Details

Keywords: Debt Crisis; Hyperinflation; Financial Crisis; Inflation and Deflation; Currency Exchange Rate; Argentina

December 2012
Course Overview Note

Entrepreneurial Management in a Turnaround Environment (EMTE) Fall 2012: Course Overview and Syllabus

Course Overview and Syllabus in the Fall Term 2012 for the Entrepreneurial Management in a Turnaround Environment (EMTE) course. View Details

Keywords: Entrepreneurial Management; Entrepreneurs; Entrepreneurship; Turnarounds; Bankruptcy Reorganization; Bankruptcy; Small ＆ Medium-sized Enterprises; Careers; Entrepreneurial Finance; Distressed Debt; Insolvency and Bankruptcy; Management Analysis, Tools, and Techniques; Management; Organizational Change and Adaptation; Organizational Culture

Article

Credit Access and Social Welfare: The Rise of Consumer Lending in the United States and France

By: Gunnar Trumbull

Research into the causes of the 2008 financial crisis has drawn attention to a link between growing income inequality in the United States and high household indebtedness. Most accounts trace the U.S. idea of credit-as-welfare to the period of wage stagnation and... View Details

Keywords: Household Finance; Welfare State; Credit; Personal Finance; Welfare; Borrowing and Debt; France; United States

October 2012
Supplement

Hill Country Snack Foods Co., Spreadsheet for Students (Brief Case) (CW)

By: W. Carl Kester and Craig Stephenson

Keywords: United States; Debt Management; Retail Trade; Risk Management; Food; Capital Structure; Borrowing and Debt; Financial Strategy; Retail Industry; United States

Working Paper

Covenant-Light Contracts and Creditor Coordination

By: Bo Becker and Victoria Ivashina

In 2015, 70% of newly issued leveraged loans had weaker enforcement features, called covenant-light or "cov-lite"; this is nearly a three-time increase in cov-lite issuance compared to a previous peak in 2007. We evaluate whether this development can be attributed to... View Details

Keywords: Credit Cycles; Loan Contracts; Debt Covenants; Contracts; Financing and Loans; Credit; Borrowing and Debt

SSRN

October 2012
Teaching Note

Hill Country Snack Foods Co. (Brief Case)

By: W. Carl Kester and Craig Stephenson

Keywords: United States; Debt Management; Retail Trade; Risk Management; Food; Capital Structure; Borrowing and Debt; Financial Strategy; Retail Industry; United States

2012
Case

Robert Whelan and the Student Loan Crisis (A)

By: Rosabeth M. Kanter and Olivia Leskinen

Robert Whelan and the Student Loan Crisis (A) 2009 AL Fellow Bob Whelan developed an idea with partners that was a seed before his fellowship year and seemed to address a significant national challenge - college financing - with a creative concept and experience from... View Details

April 2015 (Revised April 2022)
Case

Bankruptcy in the City of Detroit

By: Stuart Gilson, Kristin Mugford and Annelena Lobb

The June 2013 bankruptcy of the city of Detroit, Michigan was, at the time, the largest municipal bankruptcy in American history. Detroit had struggled for years with a weakening tax base, high unemployment, a heavy debt load and increasing retiree costs. These... View Details

May 2019
Article

Corporate Debt, Firm Size and Financial Fragility in Emerging Markets

By: Laura Alfaro, Gonzalo Asis, Anusha Chari and Ugo Panizza

The post-Global Financial Crisis period shows a surge in corporate leverage in emerging markets and a number of countries with deteriorated corporate financial fragility indicators (Altman’s Z-score). Firm size plays a critical role in the relationship between... View Details

Keywords: Corporate Debt; Firm Size; Financial Fragility; Emerging Market; Organizations; Borrowing and Debt; Financial Condition; Emerging Markets; System Shocks

February 2021
Supplement

HNA Group: Global Excellence with Chinese Characteristics (C)

By: William C. Kirby, Billy Chan and John P. McHugh

July 2017 was supposed to be a triumphant month for HNA Group. The latest Fortune Global 500 list showed the company had again skyrocketed in its ranking to no. 170, an improvement of over 200 positions from the year prior. Yet earlier that same July, the mysterious... View Details

Keywords: Conglomerate; Airline Industry; Coronavirus; Financial Risk; Debt; Bankruptcy; Global Strategy; Restructuring; Health Pandemics; Financial Markets; Organizational Change and Adaptation; Financial Condition; Globalized Firms and Management; Business and Government Relations; Air Transportation Industry; Financial Services Industry; China