Investment-Banking Relationships: 1933-2007

We study the evolution of investment bank relationships with issuers from 1933-2007. The degree to which issuers conditioned upon prior relationship strength when selecting an investment bank declined steadily after the 1960s. The issuer's probability of selecting a bank with strong relationships with its competitors also declined after the 1970s. In contrast, issuers have placed an increasing emphasis upon the quantity and the quality of their investment bank's connections with other banks. We relate the structural changes in bank/client relationships beginning in the 1970s to technological changes that altered the institutional constraints under which security issuance occurs

Essays in optimal contracting under asymmetric information

EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Преимущества автоматизированного подхода проектирования промышленных сетей перед традиционным подходом

We study the evolution of investment-banking relationships from 1933 to 2007. Relationship exclusivity and client concerns for the state of their banking relationships were strong through the first part of our sample period but then entered a period of sharp decline beginning around 1970. We interpret the bank-client relationship as an informal governance mechanism for curbing opportunistic behavior in a weak contracting environment and examine how technological change aggravated conflicts of interest within investment banks and between banks and their clients. This perspective sheds light on why trust between banks and their clients now appears to be in short supply