Tag Archives: Economics

ETF Rebalancing, Hedge Fund Trades, and Capital Markets

By | May 16, 2023
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Over the past decade, exchange-traded funds (ETFs) have transformed the investment industry with total net assets skyrocketing to $6.73 trillion by February 2023. As a passive investment product, ETFs track a particular index and aim to replicate its performance. To maintain low tracking error, ETFs rebalance portfolios following underlying index reconstitutions. With the rise in… Read More: ETF Rebalancing, Hedge Fund Trades, and Capital Markets »

Long-Run IPO Performance and the Role of Venture Capital 

By | May 1, 2023
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IPOs only offer a partial exit to Venture Capitalists (VCs). When a VC-backed company goes public, the VC typically refrains from selling all shares at the IPO. Due to the high levels of information asymmetry at the IPO, selling a large fraction of the holdings sends a negative signal concerning the company’s valuation. Iliev and… Read More: Long-Run IPO Performance and the Role of Venture Capital  »

Do R&D-intensive firms publish in academic journals to communicate with investors? 

By | April 27, 2023
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Investors may find firms engaged in research and development (R&D) attractive investment opportunities due to their high growth potential. At the same time, R&D is a risky, uncertain process, and the progress of a firm’s R&D activities is difficult for outsiders to assess, resulting in substantial information asymmetry between firms and investors. Firms in the… Read More: Do R&D-intensive firms publish in academic journals to communicate with… »

Towards A Capital Efficient Digital Currency  

By | April 12, 2023
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In this blog post, we analyse tokenized deposits in terms of financial motivation, regulation, technological implementation, and interaction with retail and wholesale central bank digital currencies (CBDCs), with particular attention to the European perspective. We conclude that the tokenization of deposits is a crucial enabler for the success of future CBDCs and needs to enter… Read More: Towards A Capital Efficient Digital Currency   »

How Economic Fitness Can Improve Industrial and Sovereign Development Funds Policies 

By | April 11, 2023
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The idea that industrial policy is back in vogue has become something of a cliché in recent years. Joseph Stiglitz, the Nobel Prize winning economist, and Justin Lin, a former Chief Economist of the World Bank, were onto the trend early, arguing in 2015, “today, the relevance and pertinence of industrial policies are acknowledged by… Read More: How Economic Fitness Can Improve Industrial and Sovereign Development Funds… »

Security Issuance, Institutional Investors and Quid Pro Quo: Insights from SPACs 

By | January 27, 2023
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Why is it So Costly to Go Public?  The average first-day returns to investors of initial public offerings (“IPOs”) in the U.S. is 19%. These returns are even higher elsewhere, such as in China. For reference, the S&P 500 index gains only a few basis points a day on average. While a large one-day return… Read More: Security Issuance, Institutional Investors and Quid Pro Quo: Insights from… »

The Age Gap in Mortgage Access

By | January 26, 2023
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The views expressed in this blog post and the associated paper are solely those of the author and do not necessarily reflect the views of the Federal Reserve Bank of Philadelphia, the Federal Reserve Board, or the Federal Reserve System. Any errors or omissions are the responsibility of the author. No statements here should be… Read More: The Age Gap in Mortgage Access »

Do CEOs Benefit from Employee Pay Raises? Evidence from a Federal Minimum Wage Law 

By | December 15, 2022
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The rising disparity between CEO and worker pay over the past few decades has been attracting considerable attention from academics. Over the last two decades, the CEO to median employee pay ratio has been increasing for small (S&P SmallCap 600), medium (S&P MidCap 400), and large (S&P 500) firms. The literature names the managerial rent… Read More: Do CEOs Benefit from Employee Pay Raises? Evidence from a… »

The Effects of Big Data on Commercial Banks 

By | December 5, 2022
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The past decade has witnessed a revolution in the use of massive amounts of data for businesses’ decision-making. According to a report by Forbes, there were 2.5 quintillion bytes of data created each day in 2018. Most of the time, the volume of data is too great for people to handle. Thanks to the advancement… Read More: The Effects of Big Data on Commercial Banks  »

Forecasting the How and Why of Corporate Crime’s Demise 

By | December 2, 2022
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How would our world function if corporate criminal liability ceased to exist? This was the provocative question posed to the participants in the Journal of Corporation Law’s recently published symposium issue on corporate crime. Several of my colleagues argue for or against corporate crime’s end or survey the aftermath of such an implosion. My contribution… Read More: Forecasting the How and Why of Corporate Crime’s Demise  »