Federal Taxation: Supreme Court Announces “Proper Regard” Test to Determine Conclusiveness of State Court Adjudications of Property Rights

This correspondence extends previously reported work [1, 2] on the problem, or rather possibility, of achieving optimality of beamspace (BS) array processing, where use is made of dimensionally reduced data vectors. The optimality here is with respect to the best possible element space (ESP) parameter estimation accuracy, i.e., the Cramér-Rao bound

Why Firms Adopt Antitakeover Arrangements

Firms going public have increasingly been incorporating antitakeover provisions in their IPO charters, while shareholders of existing companies have increasingly been voting in opposition to such charter provisions. This paper identifies possible explanations for this empirical pattern. Specifically, I analyze explanations based on (1) the role of antitakeover arrangements in encouraging founders to break up their initial control blocks, (2) efficient private benefits of control, (3) agency problems among pre-IPO shareholders, (4) agency problems between pre-IPO shareholders and their IPO lawyers, (5) asymmetric information between founders and public investors about the firm's future growth prospects, and (6) bounded attention and imperfect pricing at the IPO stage.

Performance Analysis of Sparse Recovery Based on Constrained Minimal Singular Values

The stability of sparse signal reconstruction is investigated in this paper. We design efficient algorithms to verify the sufficient condition for unique $\ell_1$ sparse recovery. One of our algorithm produces comparable results with the state-of-the-art technique and performs orders of magnitude faster. We show that the $\ell_1$-constrained minimal singular value ($\ell_1$-CMSV) of the measurement matrix determines, in a very concise manner, the recovery performance of $\ell_1$-based algorithms such as the Basis Pursuit, the Dantzig selector, and the LASSO estimator. Compared with performance analysis involving the Restricted Isometry Constant, the arguments in this paper are much less complicated and provide more intuition on the stability of sparse signal recovery. We show also that, with high probability, the subgaussian ensemble generates measurement matrices with $\ell_1$-CMSVs bounded away from zero, as long as the number of measurements is relatively large. To compute the $\ell_1$-CMSV and its lower bound, we design two algorithms based on the interior point algorithm and the semi-definite relaxation

Using Options to Divide Value in Corporate Bankruptcy

This paper revisits the proposal to use options in corporate bankruptcy that was put forward in Bebchuk (1988). According to the proposed procedure, corporate bankruptcy should be implemented through the distribution to participants of appropriately designed options. The paper starts by discussing the goals that should guide the design of bankruptcy procedures. The paper then explains how the options procedure can improve both ex post efficiency and ex ante efficiency. The paper offers a refined version of the procedure, and it also responds to questions that have been raised regarding the execution and desirability of the procedure. The paper concludes by explaining the relationship between the options approach to corporate bankruptcy and the Black-Scholes characterization of all corporate securities as options.

A Rent-Protection Theory of Corporate Ownership and Control

This paper develops a rent-protection theory of corporate ownership structure - and in particular, of the choice between concentrated and dispersed ownership of corporate shares and votes. The paper analyzes the decision of a company's initial owner whether to maintain a lock on control when the company goes public. This decision is shown to be very much influenced by the size that private benefits of control are expected to have. Most importantly, when private benefits of control are large - and when control is thus valuable enough - leaving control up for grabs would attract attempts by rivals to grab control and thereby capture these private benefits; in such circumstances, to preclude a control grab, the initial owner might elect to maintain a lock on control. Furthermore, when private benefits of control are large, maintaining a lock on control would enable the company's initial shareholders to capture a larger fraction of the surplus from value-producing transfers of control. Both results suggest that, in countries in which private benefits of control are large, publicly traded companies will tend to have a controlling shareholder. It is also shown that separation of cash flow rights and voting rights will tend to be used in conjunction with a controlling shareholder structure but not with a dispersed ownership structure. Finally, the paper analyzes why companies might make control partially contestable, as many US companies currently do by adopting antitakeover arrangements. The results of the paper are consistent with the available evidence, can explain the observed patterns of corporate ownership, and yield testable predictions for future empirical work. The analysis also implies that a corporate law system that effectively limits private benefits of control can produce more efficient choices of ownership structure.