Blog posts


“Never again” (or not?) — The European bail-in regime has yet to solve the systemic problem of implicit government guarantees

2 minute read

Published at: Oxford Business Law Blog

“Never again” was the impassioned conviction of governments worldwide after being forced to bail out banking institutions and provide guarantees and capital to avert systemic collapse as a result of the global financial crisis of 2007/08. Since then, the responsible international regulatory bodies have developed a slew of new regulations, including enhanced supervision, capital surcharges, and resolution regimes specifically for banks that would jeopardize the financial system if they were to fail. But is this bail-in regime credible? Read more

A Law and Economics Analysis of the European Takeover Directive: What about Enforcement?

5 minute read

Published at: Oxford Business Law Blog

A vast literature studies the role of institutions, such as regulation, for economic outcomes. An implicit assumption in many theoretical and empirical studies in the field is that the law is perfectly enforceable. However, in practice, most of the time this is not the case. The law may not be perfectly enforceable for several reasons. One reason is that enforcers may be capacity-constrained and therefore cannot prosecute each case. Another reason is that the costs of enforcement are too high to motivate economic agents to insist on their rights. There is another ‘European-specific’ reason for imperfect enforcement: European member states, which are obliged to transpose EU-level directives into national laws, often have considerable discretion over the design and scope of their enforcing bodies within their jurisdictions, which they may use to conserve or increase their competitive advantage. Read more


How Merger Control Impedes an Efficient Market for Corporate Control

3 minute read

Published at: Oxford Business Law Blog

Recent deliberations among antitrust enforcers about the pros and cons of breaking up BigTech have put the effectiveness of competition policy center stage. In our recent article in the Journal of Corporate Finance, we shed novel light on some unintended consequences of competition policy. Specifically, the article shows that, while attempting to prevent anti-competitive business combinations, an unintended and harmful byproduct of European merger control is that it impedes an efficient market for corporate control. Read more

Do Institutional Investors Prevent The Market For Tokenized Assets From Failing?

3 minute read

Published at: Duke Law School FinReg Blog

Given the absence of an institutional framework for the ICO market that could effectively mitigate the moral hazard in signaling, we ask, in a recent Journal of Corporate Finance publication, whether the ICO market is able to efficiently cope with this problem on its own. Specifically, we study whether institutional investors, such as Venture Capital (VC) funds, can extract economic rents associated with market-wide services such as rigorous due diligence and certification of high-quality start-ups. Read more

How do CEO emotions impact firm value?

3 minute read

Published at: Strategic Management Society (SMS) Blog

Why are CEOs coached for many hours in preparation for important public announcements, such as their presentations at annual meetings? The extensive preparation is because CEOs know that shareholders, the media, and other stakeholders will pay close attention not only to what they present but to how they present. How CEOs are perceived when they confer information may provide important clues as to how CEOs interpret the information themselves. Read more