Blocks, liquidity and corporate control

corporate ownership;control;liquidity;free riding

Repo Runs

This paper develops a model of financial institutions that borrow short- term and invest into long-term marketable assets. Because these financial intermediaries perform maturity transformation, they are subject to runs. We endogenize the profits of the intermediary and derive distinct liquidity and solvency conditions that determine whether a run can be prevented. We first characterize these conditions for an isolated intermediary and then generalize them to the case where the intermediary can sell assets to prevent runs. The sale of assets can eliminate runs if the intermediary is solvent but illiquid. However, because of cash-in-the-market pricing, this becomes less likely the more intermediaries are facing problems. In the limit, in case of a general market run, no intermediary can sell assets to forestall a run, and our original solvency and liquidity constraints are again relevant for the stability of financial institutions.Investment banking;securities dealers;repurchase agreements;tri-party repo;runs;financial fragility

The political economy of corporate control and labor rents

In a democracy, a political majority can influence both the corporate governance structure and the return to human and financial capital. We argue that when financial wealth is sufficiently concentrated, there is political support for high labor rents and a strong governance role for banks or large investors. The model is consistent with the "great reversal" phenomenon in the first half of the 20th century. We offer evidence that in several financially developed countries a financially weakened middle class became concerned about labor income risk associated with free markets and supported a more corporatist financial system

Blocks, liquidity and corporate control

Australia - SydneyVolume 18, Page 6Colo

The Political Economy of Capital Reallocation

In this paper we develop a positive theory of capital market frictions. We focus on a political conflict that arises between citizens with different vintages of human capital. Once human capital is sunk in a firm- or sector specific technology, stakeholders will resist the emergence of newer sectors to avoid inter-sectoral reallocation of capital and thus a reduction in their (quasi) rents. We argue that in democracies, a majority will choose to protect stakeholder interests and restrict capital mobility if (i) wealth is concentrated; (ii) technology growth is high; and (iii) social mobility is low

European Financial Markets after EMU: A First Assessment.

This paper reviews the first evidence on the impact of European Monetary Union on European capital markets, one year after the launch of the single currency. Our assessment of this evidence is very favourable. On almost all counts EMU has either already drastically changed the European financial landscape or has the potential to do so in the future. We argue that this is less due to the well-known direct effects of EMU, such as the elimination of intra-European currency risk, than to a number of indirect consequences through feedback mechanisms that seem to have been triggered by EMU

Investigations of Crack Growth in Railroad Car Wheels Caused by Thermally Induced Residual Stress Changes and Cyclic Mechanical Loading

127 p.Thesis (Ph.D.)--University of Illinois at Urbana-Champaign, 1978.U of I OnlyRestricted to the U of I community idenfinitely during batch ingest of legacy ETD