The Journal of Finance publishes leading research across all the major fields of finance. It is one of the most widely cited journals in academic finance, and in all of economics. Each of the six issues per year reaches over 8,000 academics, finance professionals, libraries, and government and financial institutions around the world. The journal is the official publication of The American Finance Association, the premier academic organization devoted to the study and promotion of knowledge about financial economics.
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Urban Vibrancy and Corporate Growth
Published: 09/17/2014 | DOI: 10.1111/jofi.12215
CASEY DOUGAL, CHRISTOPHER A. PARSONS, SHERIDAN TITMAN
We find that a firm's investment is highly sensitive to the investments of other firms headquartered nearby, even those in very different industries. A firm's investment also responds to fluctuations in the cash flows and stock prices (q) of local firms outside its sector. These patterns do not appear to reflect exogenous area shocks such as local shocks to labor or real estate values, but rather suggest that local agglomeration economies are important determinants of firm investment and growth.
Anchoring on Credit Spreads
Published: 02/04/2015 | DOI: 10.1111/jofi.12248
CASEY DOUGAL, JOSEPH ENGELBERG, CHRISTOPHER A. PARSONS, EDWARD D. VAN WESEP
This paper documents that the path of credit spreads since a firm's last loan influences the level at which it can currently borrow. If spreads have moved in the firm's favor (i.e., declined), it is charged a higher interest rate than is justified by current fundamentals, whereas if spreads have moved to the firm's detriment, it is charged a lower rate. We evaluate several possible explanations for this finding, and conclude that anchoring to past deal terms is most plausible.