Trade credit and supplier competition

This paper examines how competition among suppliers affects their willingness to provide trade credit financing. Trade credit extended by a supplier to a cash constrained retailer allows the latter to increase cash purchases from its other suppliers, leading to a free rider problem. A supplier that represents a smaller share of the retailer's purchases internalizes a smaller part of the benefit from increased spending by the retailer and, as a result, extends less trade credit relative to its sales. In consequence, retailers with dispersed suppliers obtain less trade credit than those whose suppliers are more concentrated. The free rider problem is especially detrimental to a trade creditor when the free-riding suppliers are its product market competitors, leading to a negative relation between product substitutability among suppliers to a given retailer and trade credit that the former provide to the latter. We test the model using both simulated and real data. The estimated relations are consistent with the model's predictions and are statistically and economically significant

A Theory of Merger-Driven IPOs

We propose a model that links a firm’s decision to go public with its subsequent takeover strategy. A private bidder does not know a firm’s true valuation, which affects its gain from a potential takeover. Consequently, a private bidder pursues a suboptimal restructuring policy. An alternative route is to complete an initial public offering (IPO) first. An IPO reduces valuation uncertainty, leading to a more efficient acquisition strategy, therefore enhancing firm value. We calibrate the model using data on IPOs and mergers and acquisitions (M&As). The resulting comparative statics generate several novel qualitative and quantitative predictions, which complement the predictions of other theories linking IPOs and M&As. For example, the time it takes a newly public firm to attempt an acquisition of another firm is expected to increase in the degree of valuation uncertainty prior to the firm’s IPO and in the cost of going public, and it is expected to decrease in the valuation surprise realized at the time of the IPO. We find strong empirical support for the model’s predictions

Increase of SERS Signal Upon Heating or Exposure to a High-Intensity Laser Field: Benzenethiol on an AgFON Substrate

The surface-enhanced Raman scattering (SERS) signal from an AgFON plasmonic substrate, recoated with benzenethiol, was observed to increase by about 100% upon heating for 3.5 min at 100C and 1.5 min at 125C. The signal intensity was found to increase further by about 80% upon a 10 sec exposure to a high-intensity (3.2 kW/cm^2) 785-nm cw laser, corresponding to 40 mW in a 40+/-5-um diameter spot. The observed increase in the SERS signal may be understood by considering the presence of benzenethiol molecules in an intermediate or 'precursor' state in addition to conventionally ordered molecules forming a self-assembled monolayer. The increase in the SERS signal arises from the conversion of the molecules in the precursor state to the chemisorbed state due to thermal and photo-thermal effects.Comment: 9 pages, 4 figures; J. Phys. Chem. C, accepte

Antiangiogenic therapy for breast cancer

Angiogenesis is an important component of cancer growth, invasion and metastasis. Therefore, inhibition of angiogenesis is an attractive strategy for treatment of cancer. We describe existing clinical trials of antiangiogenic agents and the challenges facing the clinical development and optimal use of these agents for the treatment of breast cancer. Currently, the most promising approach has been the use of bevacizumab, a humanized monoclonal antibody directed against the most potent pro-angiogenic factor, vascular endothelial growth factor (VEGF). Small molecular inhibitors of VEGF tyrosine kinase activity, such as sorafenib, appear promising. While, the role of sunitinib and inhibitors of mammalian target of rapamycin (mTOR) in breast cancer has to be defined. Several unanswered questions remain, such as choice of drug(s), optimal duration of therapy and patient selection criteria

Redirecting research efforts on the diversification-performance linkage: The search for synergy

We review the literature on the diversification-performance (D-P) relationship to a) propose that the time is ripe for a renewed attack on understanding the relationship between diversification and firm performance, and b) outline a new approach to attacking the question. Our paper makes four main contributions. First, through a review of the literature we establish the inherent complexities in the D-P relationship and the methodological challenges confronted by the literature in reaching its current conclusion of a non-linear relationship between diversification and performance. Second, we argue that to better guide managers the literature needs to develop along a complementary path – whereas past research has often focused on answering the big question of does diversification affect firm performance, this second path would focus more on identifying the precise micro-mechanisms through which diversification adds or subtracts value. Third, we outline a new approach to the investigation of this topic, based on (a) identifying the precise underlying mechanisms through which diversification affects performance; (b) identifying performance outcomes that are “proximate” to the mechanism that the researcher is studying, and (c) identifying an appropriate research design that can enable a causal claim. Finally, we outline a set of directions for future research

Liquidity, Innovation, And Endogenous Growth

We study optimal liquidity management, innovation, and production decisions for a continuum of firms facing financing frictions and the threat of creative destruction. We show that financing constraints lead firms to decrease production but may spur investment in innovation (R&D). We characterize which firms should substitute production for innovation in the face of constraints and thus display a "gambling" type of behavior. We embed our firm dynamics into a model of endogenous growth and show that financing frictions have offsetting effects on economic growth