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Bond Default Matters in China: Evidence from Illiquidity Premium
This paper studies how market-wide credit risk affects the liquidity pricing in the bond market With the emergin

Haoyu Gao, Dapeng Hao, Dun Jia, Zhigang Qiu

Working Paper | No. 20220903 |

Keywords: Default events, credit spread, illiquidity premium, flight-to-liquidity

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Non-Standard Choice in Matching Markets
We explore the possibility of designing matching mechanisms that can accommodate non-standard choice behavior We p

Gian Caspari, Manshu Khanna

Working Paper | No. 20220902 |

Keywords: Matching theory, market design, stability, college admissions market

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Beyond Dividing the Pie: Multi-Issue Bargaining in the Laboratory
We design a laboratory experiment to study bargaining behavior when negotiations involve multiple issues Parties m

Olivier Bochet, Manshu Khanna, Simon Siegenthaler

Working Paper | No. 20220901 |

Keywords: Negotiation scope, asymmetric information, bundling, alternating offers, value creation

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Price Rigidities and the Value of Public Information
AbstractFirms’ inflexibility in adjusting output prices to economic shocks exacerbates information asymmetry abo

Lifeng Gu, Jin Xie

Working Paper | No.20220708 |

Keywords: Nominal Rigidities, Information Frictions, Public Information, Capital-Market Efficiency

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Punish One, Teach A Hundred: The Sobering Effect of Punishment on the Unpunished
Direct experience of a peer’s punishment might have a sobering effect above and beyond deterrence (informatio

Francesco D’Acunto, Michael Weber, Jin Xie

Working Paper | No. 20220707 |

Keywords: Corporate Governance, Cultural Finance, Information Transmission, Peer Effects, Reputational Sanctions, Related Party Transactions, Emerging Markets

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Internal Capital Markets and the Transmission of Exchange-Rate Shocks
Liquidity-constrained large shareholders often reallocate capital within business groups to finance their own project

Kang Shi, Jin Xie, Juanyi (Jenny) Xu

Working Paper | No. 20220706 |

Keywords: Internal Capital Market, Corporate Governance, Collateral Constraint, Exchange Rates, Export Pricing

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Regime Shifts in a Long-run Risks Model of U.S. Stock and Treasury Bond Markets
We study the joint determinants of stock and bond returns in a long-run risks model framework with regime shifts

Kai Li, Chenjie Xu

Working Paper | No. 20220705 |

Keywords: Regime shift, risks model, U S stock, treasury bond market

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The Unmeasured Finance in Misallocation
This paper documents a large overestimation of measured finance misallocation (Whited and Zhao, 2021) when lease-induced debt is ignored among US manufacturing firms Appropriately accounting for leases on the liability side translates into a 5 5% real va

Weiwei Hu, Kai Li, Yiming Xu

Working Paper | No. 20220704 |

Keywords: Lease-induced debt, External finance, Misallocation of finance

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Turbulent Business Cycles
Recessions are associated with sharp increases in turbulence that reshuffle firms’ productivity rankings To s

Ding Dong, heng Liu, Pengfei Wang

Working Paper | No. 20220703 |

Keywords: Turbulence,heterogeneous firms, financial frictions, reallocation, productivity, business cycles

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Trust and Contracts: Empirical Evidence
Trust between parties should drive contract design: if parties were suspicious about each others’ reaction to

Francesco D’Acunto, Jin Xie, Jiaquan Yao

Working Paper | No.20220702 |

Keywords: Empirical Contract Theory, Incomplete Contracts, Cultural Economics, Beliefs and Choice, Personnel Economics, Organizational Economics, FinTech and Textual Analysis, Consulting, Management

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