The Role of Debt in Interactive Corporate Governance

Most of the corporate governance literature rests on a premise that the interests of various stakeholder groups conflict and that managerial loyalty is more likely to be captured by shareholders than any other constituency. Yet, stakeholder interests do converge in the objective of controlling managerial slack and non-equity constituents have substantial influence over firm decisions. Although the study of governance has taken early steps to abandon its preoccupation with equity-centered solutions and identify interdependencies existing among a broader range of stakeholders, governance scholars have missed an important element of interactivity. A stakeholder reacts to the actions of others and thereby contributes to the collective interest in controlling slack. Each stakeholder has a window on the firm through which it can acquire some type of information at lower cost than other stakeholders. When a stakeholder detects an unsatisfactory state of affairs, it reacts by choosing to exit or exercise voice. The exercise of either the voice or exit option may pressure management to correct the unsatisfactory state of slack. More to the point, however, a stakeholder\u27s exit bears important information for other stakeholders, at least some of whom may be better placed to take action that corrects the slack. This Article describes an interactive system of corporate governance and provides a stylized theory of the role of lenders within this system. The divergence in the interests of these lenders and other stakeholders does not preclude interactive governance, but it does threaten to reduce the net benefits from the process. Therefore, the authors identify a number of legal and institutional mechanisms that help to channel the efforts of the lender toward the common goal of containing and correcting managerial slack. The interactive perspective thus permits new explanations for phenomena such as debt covenants, bankruptcy preference rules and lender liability laws. For example, the definition of debt covenants and events of default in lending agreements raise the likelihood that the lender exit is prompted by slack rather than lender opportunism and thereby enhances the informational value of the exit. Bankruptcy preference rules encourage early exit before the firm becomes insolvent, thereby enabling remaining stakeholders to take action before the firm\u27s condition becomes irreparable. Thus, debt covenants and preference rules provide a window that increases the value of lender exit in prompting the correction of managerial slack

Ernst Freund as Precursor of the Rational Study of Corporate Law

Gindis, David, Ernst Freund as Precursor of the Rational Study of Corporate Law (October 27, 2017). Journal of Institutional Economics, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2905547, doi: https://dx.doi.org/10.2139/ssrn.2905547The rise of large business corporations in the late 19th century compelled many American observers to admit that the nature of the corporation had yet to be understood. Published in this context, Ernst Freund's little-known The Legal Nature of Corporations (1897) was an original attempt to come to terms with a new legal and economic reality. But it can also be described, to paraphrase Oliver Wendell Holmes, as the earliest example of the rational study of corporate law. The paper shows that Freund had the intuitions of an institutional economist, and engaged in what today would be called comparative institutional analysis. Remarkably, his argument that the corporate form secures property against insider defection and against outsiders anticipated recent work on entity shielding and capital lock-in, and can be read as an early contribution to what today would be called the theory of the firm.Peer reviewe

Measurement of isolated photon production in pp and PbPb collisions at sqrt(sNN) = 2.76 TeV

Isolated photon production is measured in proton-proton and lead-lead collisions at nucleon-nucleon centre-of-mass energies of 2.76 TeV in the pseudorapidity range |eta|<1.44 and transverse energies ET between 20 and 80 GeV with the CMS detector at the LHC. The measured ET spectra are found to be in good agreement with next-to-leading-order perturbative QCD predictions. The ratio of PbPb to pp isolated photon ET-differential yields, scaled by the number of incoherent nucleon-nucleon collisions, is consistent with unity for all PbPb reaction centralities.Comment: Submitted to Physics Letters

Search for top squark pair production in pp collisions at root s=13 TeV using single lepton events

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Search for a light pseudoscalar Higgs boson produced in association with bottom quarks in pp collisions at root s=8 TeV

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Pseudorapidity distributions of charged hadrons in proton-lead collisions at root s(NN)=5:02 and 8.16 TeV

The pseudorapidity distributions of charged hadrons in proton-lead collisions at nucleon-nucleon center-of-mass energies root s(NN) = 5.02 and 8.16 TeV are presented. The measurements are based on data samples collected by the CMS experiment at the LHC. The number of primary charged hadrons produced in non-single-diffractive proton-lead collisions is determined in the pseudorapidity range vertical bar eta(lab)vertical bar vertical bar(vertical bar eta cm vertical bar) <0.5 are 17.1 +/- 0.01 (stat) +/- 0.59 (syst) and 20.10 +/- 0.01 (stat) +/- 0.5(syst) at root s(NN) = 5.02 and 8.16 TeV, respectively. The particle densities per participant nucleon are compared to similar measurements in proton-proton, proton-nucleus, and nucleus-nucleus collisions.Peer reviewe

Measurement of vector boson scattering and constraints on anomalous quartic couplings from events with four leptons and two jets in proton-proton collisions at root s=13 TeV

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Search for Higgsino pair production in pp collisions at root s=13 TeV in final states with large missing transverse momentum and two Higgs bosons decaying via H -> b(b)over bar

Results are reported from a search for new physics in 13 TeV proton-proton collisions in the final state with large missing transverse momentum and two Higgs bosons decaying via H -> b(b)over bar. The search uses a data sample accumulated by the CMS experiment at the LHC in 2016, corresponding to an integrated luminosity of 35.9 fb(-1). The search is motivated by models based on gauge-mediated supersymmetry breaking, which predict the electroweak production of a pair of Higgsinos, each of which can decay via a cascade process to a Higgs boson and an undetected lightest supersymmetric particle. The observed event yields in the signal regions are consistent with the standard model background expectation obtained from control regions in data. Higgsinos in the mass range 230-770 GeV are excluded at 95% confidence level in the context of a simplified model for the production and decay of approximately degenerate Higgsinos.Peer reviewe

Search for direct production of supersymmetric partners of the top quark in the all-jets final state in proton-proton collisions at root s=13 TeV

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