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Chair of Finance and Economics
Prof. Dr. Roman Inderst

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Department of Finance

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Beschreibung: Beschreibung: Beschreibung: Z:\blue.gif Prof. Inderst

Beschreibung: Beschreibung: Beschreibung: Z:\blue.gif Publications

 - Finance

 - Microeconomic Theory

 - Competition/IO

 - Policy Papers/Presentations


ID2: 693 | ID3: | Numr: 6 | Prof: 8

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(Corporate) Finance / Banking         

 

For academic and policy papers on consumer protection see also the page “Micro Theory”.

 

See bottom of page for English and German policy papers on regulation and stability.

 

Current Working Papers

 

Trading on Advice (with A. Hackethal and S. Meyer), 2011 

Securitization and Compensation in Financial Institutions (with S. Pfeil), 2011

Preserving "Debt Capacity" or "Equity Capacity": A Dynamic Theory of Security Design (with V. Vladimirov), 2011

Prudence as a Competitive Advantage: On the Effects of Competition on Banks' Risk-Taking Incentives, 2011

 

Publications in Main Journals

 

 How (Not) to Pay for Advice: A Framework for Consumer Financial Protection

 (with M. Ottaviani), Journal of Financial Economics, forthcoming

 

 Loan Prospecting

 (with F. Heider), Review of Financial Studies, forthcoming

 

CEO Replacement under Private Information

(with H.Müller), Review of Financial Studies, 2010, 23(8), 2935-2969

 

Early-Stage Financing and Firm Growth in New Industries

(with H. Müller), Journal of Financial Economics, 2009, 93(2), 276-291

 

Bank Capital Structure and Credit Decisions 

(with H. Müller), Journal of Financial Intermediation, 2008, 17(3), 295-314

 

“Irresponsible Lending” with a Better Informed Lender

 Economic Journal, 2008, 118(532), 1499-1519 

(previously circulated as: Consumer Lending When Lenders are More Sophisticated Than Households)

 

Innovation, Endogenous Overinvestment, and Incentive Pay

(with M. Klein), Rand Journal of Economics, 2007, 38(4), 881-904

In a setting where capital budgeting crucially relies on the information provided by (division) managers we study the role of incentive contracts and the implications of creating an internal capital market. Various predictions linking incentive pay to investment decisions are obtained.”

 

Financing a Portfolio of Projects 

(with F. Münnich and H. Müller), Review of Financial Studies, 2007, 20(4), 1289-1325

(previously entitled “The Benefits of Shallow Pockets”)

The paper takes a portfolio perspective to real investments, with a particular application to venture capital, determining the optimal loading of a fund as a function of the characteristics of the financed projects.”

 

A Lender-Based Theory of Collateral

(with H. Müller), Journal of Financial Economics, 2007, 84(3), 826-859

“We use an informed-lender approach to obtain a novel theory of the optimal use of collateral. The theory is in line with stylized facts on the correlation between collateralization and riskiness. New implications on the relation between collateral and loan market competition are obtained.”

 

Informed Lending and Security Design

(with H. Müller), Journal of Finance, 2006, 61(5), 2137-2162

“Optimal security design is undertaken in a novel framework where lenders possess to some extent better information than their (small business) borrowers. We obtain conditions for when debt or levered equity are optimal, mirroring the use of these contracts in bank or venture capital financing. Conditions are obtained for when lenders are too conservative or too aggressive.”

 

Conglomerate Entrenchment under Optimal Financial Contracting

(with A. Faure-Grimaud), American Economic Review, 2005, 95(3), 850-861

“The “deep-pocket” argument is revisited in a framework of optimal financial contracts and under the operation of an internal capital markets. Conditions are derived for when being part of a conglomerate both shields a business unit from predatory activity and increases own incentives to engage in predation.”

 

Incentives in Internal Capital Markets

(with C. Laux),  Rand Journal of Economics, 2005, 36(1), 215-228

The paper analyzes what  implications an internal capital market has on the incentives to generate new growth opportunities. Winner picking can both increase and stifle incentives, which gives rise to a theory of the optimal project mix inside a firm.”

 

The Effect of Capital Market Characteristics on the Value of Start-Up Firms

(with H. Müller), Journal of Financial Economics, 2004, 72(2), 319-356

“Bilateral bargaining between VCs and entrepreneurs over financial contracts is studied in a search-market environment. This allows to derive predictions on how market characteristics affect contracts as well as the flow and nature of funded projects.”

 

Internal vs. External Financing: An Optimal Contracting Approach

(with H. Müller), Journal of Finance, 2003, 58(3), 1033-1062

”In a model where a borrower has only imperfect commitment to repay a loan out of future cash flows, we study the benefits and costs of integrating previously stand-alone business units. This is done under the respective optimal financial contracts.”

 

Book Chapters & Other Journals

 

Public Policy, Early-Stage Financing, and Firm Growth in New Industries,

Book chapter, "Challenges to the Financial System", Stiftung Geld und Währung, 2009

 

Law and Finance as a District Field of Research (Editorial)

European Business Organization Law Review, 2009, 10, 323-329