The Journal of Finance

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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The Limits of Investor Behavior

Published: 1/20/2006,  Volume: 61,  Issue: 1  |  DOI: 10.1111/j.1540-6261.2006.00835.x  |  Cited by: 48

MARK LOEWENSTEIN, GREGORY A. WILLARD

Many models use noise trader risk and corresponding violations of the Law of One Price to explain pricing anomalies, but include a storage technology in perfectly elastic supply or unlimited asset liability. Storage allows aggregate consumption risk to differ from exogenous fundamental risk, but using aggregate consumption as a factor for asset returns can make noise trader risk superfluous. Using (i) limited asset liability and limited storage withdrawals, or (ii) an endogenous locally riskless interest rate eliminates violations of the Law of One Price. Our main results use only budget equations and market clearing, and require virtually no assumptions about behavior.


Imperfect Competition among Informed Traders

Published: 10/2000,  Volume: 55,  Issue: 5  |  DOI: 10.1111/0022-1082.00282  |  Cited by: 269

Kerry Back, C. Henry Cao, Gregory A. Willard

We analyze competition among informed traders in the continuous‐time Kyle(1985) model, as Foster and Viswanathan (1996) do in discrete time. We explicitly describe the unique linear equilibrium when signals are imperfectly correlated and confirm the conjecture of Holden and Subrahmanyam (1992) that there is no linear equilibrium when signals are perfectly correlated. One result is that at some date, and at all dates thereafter, the market would have been more informationally efficient had there been a monopolist informed trader instead of competing traders. The relatively large amount of private information remaining near the end of trading causes the market to approach complete illiquidity.


LINEAR PROGRAMMING AND CAPITAL BUDGETING MODELS: A NEW INTERPRETATION

Published: 12/1969,  Volume: 24,  Issue: 5  |  DOI: 10.1111/j.1540-6261.1969.tb01695.x  |  Cited by: 23

Willard T. Carleton


MEASUREMENT OF RISK ATTITUDES OF WISCONSIN BANKS*

Published: 3/1963,  Volume: 18,  Issue: 1  |  DOI: 10.1111/j.1540-6261.1963.tb01624.x  |  Cited by: 0

Willard T. Carleton


AN ANALYTICAL MODEL FOR LONG‐RANGE FINANCIAL PLANNING*

Published: 5/1970,  Volume: 25,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1970.tb00507.x  |  Cited by: 2

Willard T. Carleton


DISCUSSION

Published: 6/1978,  Volume: 33,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1978.tb02016.x  |  Cited by: 0

Willard T. Carleton


JOINT DETERMINATION OF RATE OF RETURN AND CAPITAL STRUCTURE: AN ECONOMETRIC ANALYSIS

Published: 6/1977,  Volume: 32,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1977.tb01990.x  |  Cited by: 21

Willard T. Carleton, Irwin H. Silberman


ESTIMATION AND USES OF THE TERM STRUCTURE OF INTEREST RATES

Published: 9/1976,  Volume: 31,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1976.tb01960.x  |  Cited by: 68

Willard T. Carleton, Ian A. Cooper


FINANCING DECISIONS OF THE FIRM

Published: 5/1966,  Volume: 21,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1966.tb00221.x  |  Cited by: 20

Eugene M. Lerner, Willard T. Carleton


Dynamics of Borrower‐Lender Interaction: Partitioning Final Payoff in Venture Capital Finance

Published: 5/1979,  Volume: 34,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1979.tb02117.x  |  Cited by: 13

IAN A. COOPER, WILLARD T. CARLETON


REPLY

Published: 12/1968,  Volume: 23,  Issue: 5  |  DOI: 10.1111/j.1540-6261.1968.tb00325.x  |  Cited by: 0

Eugene M. Lerner, Willard T. Carleton


APPLICATION OF THE DECOMPOSITION PRINCIPLE TO THE CAPITAL BUDGETING PROBLEM IN A DECENTRALIZED FIRM

Published: 6/1974,  Volume: 29,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1974.tb01485.x  |  Cited by: 8

Willard T. Carleton, Glen Kendall, Sanjiv Tandon


INFLATION RISK AND REGULATORY LAG

Published: 5/1983,  Volume: 38,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1983.tb02247.x  |  Cited by: 2

WILLARD T. CARLETON, DONALD R. CHAMBERS, JOSEF LAKONISHOK


DISCUSSION

Published: 5/1975,  Volume: 30,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1975.tb01821.x  |  Cited by: 0

M. J. Brennan, Willard T. Carleton, Stewart C. Myers


SURVEY OF INVESTMENT MANAGEMENT: TEACHING VERSUS PRACTICE

Published: 5/1970,  Volume: 25,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1970.tb00512.x  |  Cited by: 1

Willard T. Carleton, Keith V. Smith, Maurice B. Goudzwaard


The Influence of Institutions on Corporate Governance through Private Negotiations: Evidence from TIAA‐CREF

Published: 8/1998,  Volume: 53,  Issue: 4  |  DOI: 10.1111/0022-1082.00055  |  Cited by: 600

Willard T. Carleton, James M. Nelson, Michael S. Weisbach

This paper analyzes the process of private negotiations between financial institutions and the companies they attempt to influence. It relies on a private database consisting of the correspondence between TIAA‐CREF and 45 firms it contacted about governance issues between 1992 and 1996. This correspondence indicates that TIAA‐CREF is able to reach agreements with targeted companies more than 95 percent of the time. In more than 70 percent of the cases, this agreement is reached without shareholders voting on the proposal. We verify independently that at least 87 percent of the targets subsequently took actions to comply with these agreements.


DEFINING THE FINANCE FUNCTION: A MODEL‐SYSTEMS APPROACH

Published: 12/1967,  Volume: 22,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1967.tb00291.x  |  Cited by: 4

Joseph S. Moag, Willard T. Carleton, Eugene M. Lerner


Correlated Default and Financial Intermediation

Published: 4/13/2017,  Volume: 72,  Issue: 3  |  DOI: 10.1111/jofi.12493  |  Cited by: 15

GREGORY PHELAN

Financial intermediation naturally arises when knowing how loan payoffs are correlated is valuable for managing investments but lenders cannot easily observe that relationship. I show this result using a costly enforcement model in which lenders need ex post incentives to enforce payments from defaulted loans and borrowers' payoffs are correlated. When projects have correlated outcomes, learning the state of one project (via enforcement) provides information about the states of other projects. A large correlated portfolio provides ex post incentives for enforcement. Thus, intermediation dominates direct lending, and intermediaries are financed with risk‐free deposits, earn positive profits, and hold systemic default risk.


Sufficient Conditions for Public Information to Have Social Value in a Production and Exchange Economy

Published: 9/1982,  Volume: 37,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1982.tb03593.x  |  Cited by: 21

J. GREGORY KUNKEL

Conditions are derived under which all consumers in a production and exchange economy will prefer (at least weakly) disclosure of public information to no such disclosure. The conditions involve consumer endowments, the allocative efficiency of the financial market, and value maximizing behavior by firms. Cases exist where consumers will prefer disclosure of public information in a production and exchange economy, although they would be indifferent to such disclosure in an otherwise similar pure exchange economy. The difference in results is due purely to the fact that in production and exchange economies, information may be used to reallocate resources across time and firms, thus highlighting the fundamental difference between the role of information in pure exchange and in production and exchange economies.


DISCUSSION

Published: 7/1985,  Volume: 40,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1985.tb05017.x  |  Cited by: 0

GREGORY D. HAWKINS


Time Variation in the Covariance between Stock Returns and Consumption Growth

Published: 8/2005,  Volume: 60,  Issue: 4  |  DOI: 10.1111/j.1540-6261.2005.00777.x  |  Cited by: 74

GREGORY R. DUFFEE

The conditional covariance between aggregate stock returns and aggregate consumption growth varies substantially over time. When stock market wealth is high relative to consumption, both the conditional covariance and correlation are high. This pattern is consistent with the “composition effect,” where agents' consumption growth is more closely tied to stock returns when stock wealth is a larger share of total wealth. This variation can be used to test asset‐pricing models in which the price of consumption risk varies. After accounting for variations in this price, the relation between expected excess stock returns and the conditional covariance is negative.


Information, Asset Prices, and the Volume of Trade

Published: 9/1992,  Volume: 47,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1992.tb04672.x  |  Cited by: 6

GREGORY W. HUFFMAN

A dynamic equilibrium model is constructed in which agents with access to different information sets participate in the capital market. Agents must use the equilibrium price of capital to make optimal forecasts of the return to holding capital. Examples show that the volume of trade, as well as the price of capital, can be highly correlated with a measure of the information content of prices. This measure of information is the difference between the unconditional entropy of the dividend and the entropy of the dividend conditional on observing the price of capital.


Testing an Aggressive Investment Strategy using Value Line Ranks: A Comment

Published: 3/1983,  Volume: 38,  Issue: 1  |  DOI: 10.1111/j.1540-6261.1983.tb03641.x  |  Cited by: 5

N. A. GREGORY


Idiosyncratic Variation of Treasury Bill Yields

Published: 6/1996,  Volume: 51,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1996.tb02693.x  |  Cited by: 138

GREGORY R. DUFFEE

I document a dramatic increase in the importance of two types of variation in Treasury bill yields beginning in the early 1980s. The first is idiosyncratic variation in individual short‐maturity (less than three months) bill yields. The second is a common component in Treasury bill yields that is not shared by yields on other instruments, such as short‐maturity privately‐issued instruments or longer‐maturity Treasury notes and bonds. Some evidence suggests the first type reflects increased market segmentation. These results have important implications for the calibration and testing of no‐arbitrage term structure models and interpreting tests of the expectations hypothesis.


Macroeconomic News in Asset Pricing and Reality

Published: 3/13/2023,  Volume: 78,  Issue: 3  |  DOI: 10.1111/jofi.13218  |  Cited by: 10

GREGORY R. DUFFEE

Revisions in successive Greenbook forecasts of quarterly real GDP growth proxy for news of current and expected future economic growth. In the sample 1975 through 2015, news of future growth is slightly negatively related to contemporaneous changes in Treasury bond yields, while news of current growth is strongly positively related to changes in these yields. Both results are difficult to reconcile with a representative agent's bondholding first‐order condition. A continuous‐time dynamic model of output attributes almost all of the covariation with yields to martingale innovations in log output and a minimal amount to innovations in the conditional drift of log output.


Expected Inflation and Other Determinants of Treasury Yields

Published: 7/12/2018,  Volume: 73,  Issue: 5  |  DOI: 10.1111/jofi.12700  |  Cited by: 91

GREGORY R. DUFFEE

Shocks to nominal bond yields consist of news about expected future inflation, expected future real short rates, and expected excess returns—all over the bond's life. I estimate the magnitude of the first component for short‐ and long‐maturity Treasury bonds. At a quarterly frequency, variances of news about expected inflation account for between 10% to 20% of variances of yield shocks. Standard dynamic models with long‐run risk imply variance ratios close to 1. Habit formation models fare somewhat better. The magnitudes of shocks to real rates and expected excess returns cannot be determined reliably.


THE ANALYTICS OF MULTIBANK HOLDING COMPANY BEHAVIOR*

Published: 9/1975,  Volume: 30,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1975.tb01034.x  |  Cited by: 0

Gregory Edward Boczar


Adjustment Costs and Capital Asset Pricing

Published: 7/1985,  Volume: 40,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1985.tb04992.x  |  Cited by: 4

GREGORY W. HUFFMAN

Discrete‐time models of asset pricing have hitherto generally avoided studying the relationship between the underlying technology inherent in the economy and the determinants of the price of capital. A fully articulated economy is constructed in which there is a nontrivial technology for producing capital. The existence of adjustment costs in augmenting the quantity of capital has interesting implications for the stochastic properties of asset prices, as well as other macroeconomic variables. Examples of such economies are used to illustrate this point.


The Relation Between Treasury Yields and Corporate Bond Yield Spreads

Published: 12/1998,  Volume: 53,  Issue: 6  |  DOI: 10.1111/0022-1082.00089  |  Cited by: 531

Gregory R. Duffee

Because the option to call a corporate bond should rise in value when bond yields fall, the relation between noncallable Treasury yields and spreads of corporate bond yields over Treasury yields should depend on the callability of the corporate bond. I confirm this hypothesis for investment‐grade corporate bonds. Although yield spreads on both callable and noncallable corporate bonds fall when Treasury yields rise, this relation is much stronger for callable bonds. This result has important implications for interpreting the behavior of yields on commonly used corporate bond indexes, which are composed primarily of callable bonds.


COMPETITION BETWEEN BANKS AND FINANCE COMPANIES: A CROSS SECTION STUDY OF PERSONAL LOAN DEBTORS

Published: 3/1978,  Volume: 33,  Issue: 1  |  DOI: 10.1111/j.1540-6261.1978.tb03402.x  |  Cited by: 10

Gregory E. Boczar


MARKET CHARACTERISTICS AND MULTIBANK HOLDING COMPANY ACQUISITIONS

Published: 3/1977,  Volume: 32,  Issue: 1  |  DOI: 10.1111/j.1540-6261.1977.tb03247.x  |  Cited by: 0

Gregory E. Boczar


FRIEDMAN ON MONEY*

Published: 6/1970,  Volume: 25,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1970.tb00536.x  |  Cited by: 3

Gregory C. Chow


Term Premia and Interest Rate Forecasts in Affine Models

Published: 2/2002,  Volume: 57,  Issue: 1  |  DOI: 10.1111/1540-6261.00426  |  Cited by: 1153

Gregory R. Duffee

The standard class of affine models produces poor forecasts of future Treasury yields. Better forecasts are generated by assuming that yields follow random walks. The failure of these models is driven by one of their key features: Compensation for risk is a multiple of the variance of the risk. Thus risk compensation cannot vary independently of interest rate volatility. I also describe a broader class of models. These aessentially affine‐ models retain the tractability of standard models, but allow compensation for interest rate risk to vary independently of interest rate volatility. This additional flexibility proves useful in forecasting future yields.


Predicting De Novo Expansion in Bank Merger Cases: Comment

Published: 9/1976,  Volume: 31,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1976.tb01975.x  |  Cited by: 0

Gregory E. Boczar


An Empirical Analysis of the Role of the Medium of Exchange in Mergers

Published: 6/1983,  Volume: 38,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1983.tb02503.x  |  Cited by: 60

WILLARD T. CARLETON, DAVID K. GUILKEY, ROBERT S. HARRIS, JOHN F. STEWART

In empirical studies of differences between firms which are acquired and those which are not, researchers typically divide firms into two groups‐acquired and nonacquired. In this paper, we argue that cash takeovers may be sufficiently different from noncash acquisitionst hat failure to distinguish between them may lead to inappropriateg eneralizations. We provide evidence from the mid 1970s that three categories of firms can be distinguished:n onacquireda, cquiredi n a cash takeover, and acquired in an exchange of securities.


A Test for the Number of Factors in an Approximate Factor Model

Published: 9/1993,  Volume: 48,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1993.tb04754.x  |  Cited by: 323

GREGORY CONNOR, ROBERT A. KORAJCZYK

An important issue in applications of multifactor models of asset returns is the appropriate number of factors. Most extant tests for the number of factors are valid only for strict factor models, in which diversifiable returns are uncorrelated across assets. In this paper we develop a test statistic to determine the number of factors in an approximate factor model of asset returns, which does not require that diversifiable components of returns be uncorrelated across assets. We find evidence for one to six pervasive factors in the cross‐section of New York Stock Exchange and American Stock Exchange stock returns.


The Impact of Federal Interest Rate Regulations on the Small Saver: Further Evidence

Published: 6/1981,  Volume: 36,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1981.tb00652.x  |  Cited by: 1

EDWARD C. LAWRENCE, GREGORY E. ELLIEHAUSEN

This paper provides further evidence on the distributional impact of interest rate ceilings on the small saver. Cross‐section data from the 1977 Consumer Credit Survey was used to estimate the implicit losses imposed on different income classes by government regulations. Our findings generally support earlier studies which found the implicit burden to be regressive among income classes. However, the degree of regressivity showed a marked decrease since 1970. These results may be explained by portfolio adjustments of households and financial innovations in response to deposit rate ceilings and accelerating inflation during the 1970s.


Corporate Events, Trading Activity, and the Estimation of Systematic Risk: Evidence From Equity Offerings and Share Repurchases

Published: 12/1994,  Volume: 49,  Issue: 5  |  DOI: 10.1111/j.1540-6261.1994.tb04781.x  |  Cited by: 45

DAVID J. DENIS, GREGORY B. KADLEC

We investigate the relation between trading activity, the measurement of security returns, and the evolution of security prices by examining estimates of systematic risk surrounding equity offerings and share repurchases. In contrast to prior studies, we find no evidence of changes in systematic risk following either equity offerings or share repurchases after correcting for biases caused by infrequent trading and price adjustment delays. Moreover, changes in ordinary least squares beta estimates are significantly related to contemporaneous changes in trading activity. Our results have implications for studies interested in the properties of security returns, particularly those examining periods in which trading activity changes.


Adverse Selection in Corporate Loan Markets

Published: 12/9/2025,  Volume: 81,  Issue: 1  |  DOI: 10.1111/jofi.70011  |  Cited by: 6

MEHDI BEYHAGHI, CESARE FRACASSI, GREGORY WEITZNER

Theories of competition typically predict a positive relationship between market concentration and prices. However, in loan markets, adverse selection can reverse this relationship as riskier borrowers become more likely to receive funding. Using supervisory data, we show that interest rates, borrower risk, and lending volume are higher in markets with more banks. We also create a novel measure of markup that is orthogonal to borrower risk, and find that, consistent with adverse selection, markups are higher after repeated borrowing relationships. Finally, we use a shock to large banks' lending costs to provide further support for the adverse selection channel.


Toward a Theory of Financial Accounting

Published: 5/1980,  Volume: 35,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1980.tb02185.x  |  Cited by: 2

JAMES A. OHLSON, A. GREGORY BUCKMAN


The Price Response to S&P 500 Index Additions and Deletions: Evidence of Asymmetry and a New Explanation

Published: 8/2004,  Volume: 59,  Issue: 4  |  DOI: 10.1111/j.1540-6261.2004.00683.x  |  Cited by: 476

Honghui Chen, Gregory Noronha, Vijay Singal

We study the price effects of changes to the S&P 500 index and document an asymmetric price response: There is a permanent increase in the price of added firms but no permanent decline for deleted firms. These results are at odds with extant explanations of the effects of index changes that imply a symmetric price response to additions and deletions. A possible explanation for asymmetric price effects arises from the changes in investor awareness. Results from our empirical tests support the thesis that changes in investor awareness contribute to the asymmetric price effects of S&P 500 index additions and deletions.


The Effect of Market Segmentation and Illiquidity on Asset Prices: Evidence from Exchange Listings

Published: 6/1994,  Volume: 49,  Issue: 2  |  DOI: 10.1111/j.1540-6261.1994.tb05154.x  |  Cited by: 201

GREGORY B. KADLEC, JOHN J. MCCONNELL

This article documents the effect on share value of listing on the New York Stock Exchange and reports the results of a joint test of Merton's (1987) investor recognition factor and Amihud and Mendelson's (1986) liquidity factor as explanations of the change in share value. We find that during the 1980s stocks earned abnormal returns of 5 percent in response to the listing announcement and that listing is associated with an increase in the number of shareholders and a reduction in bid‐ask spreads. Cross‐sectional regressions provide support for both investor recognition and liquidity as sources of value from exchange listing.


Why Are U.S. Stocks More Volatile?

Published: 7/19/2012,  Volume: 67,  Issue: 4  |  DOI: 10.1111/j.1540-6261.2012.01749.x  |  Cited by: 232

SÖHNKE M. BARTRAM, GREGORY BROWN, RENÉ M. STULZ

U.S. stocks are more volatile than stocks of similar foreign firms. A firm's stock return volatility can be higher for reasons that contribute positively (good volatility) or negatively (bad volatility) to shareholder wealth and economic growth. We find that the volatility of U.S. firms is higher mostly because of good volatility. Specifically, stock volatility is higher in the United States because it increases with investor protection, stock market development, new patents, and firm‐level investment in R&D. Each of these factors is related to better growth opportunities for firms and better ability to take advantage of these opportunities.


Capital Structure and Financial Risk: Evidence from Foreign Debt Use in East Asia

Published: 11/7/2003,  Volume: 58,  Issue: 6  |  DOI: 10.1046/j.1540-6261.2003.00619.x  |  Cited by: 225

George Allayannis, Gregory W. Brown, Leora F. Klapper

AbstractUsing a data set of East Asian nonfinancial companies, we examine a firm's choice between local, foreign, and synthetic local currency (hedged foreign currency) debt. We find evidence of unique as well as common factors that determine each debt type's use, indicating the importance of examining debt at a disaggregated level. We exploit the Asian financial crisis as a natural experiment to investigate the role of debt type in firm performance. Surprisingly, we find that the use of synthetic local currency debt is associated with the biggest drop in market value, possibly due to currency derivative market illiquidity during the crisis.


An Unbiased Reexamination of Stock Market Volatility

Published: 7/1985,  Volume: 40,  Issue: 3  |  DOI: 10.1111/j.1540-6261.1985.tb04990.x  |  Cited by: 126

N. GREGORY MANKIW, DAVID ROMER, MATTHEW D. SHAPIRO

Recent work demonstrates serious statistical problems with standard volatility tests. This paper proposes new tests that are unbiased in small samples and that do not require assumptions of stationarity. The new tests continue to find evidence against the model positing rational expectations and a constant required rate of return on equity.


Accounting for Forward Rates in Markets for Foreign Currency

Published: 12/1993,  Volume: 48,  Issue: 5  |  DOI: 10.1111/j.1540-6261.1993.tb05132.x  |  Cited by: 89

DAVID K. BACKUS, ALLAN W. GREGORY, CHRIS I. TELMER

Forward and spot exchange rates between major currencies imply large standard deviations of both predictable returns from currency speculation and of the equilibrium price measure (the intertemporal marginal rate of substitution). Representative agent theory with time‐additive preferences cannot account for either of these properties. We show that the theory does considerably better along these dimensions when the representative agent's preferences exhibit habit persistence, but that the theory fails to reproduce some of the other properties of the data—in particular, the strong autocorrelation of forward premiums.


The Market Impact of Trends and Sequences in Performance: New Evidence

Published: 9/16/2005,  Volume: 60,  Issue: 5  |  DOI: 10.1111/j.1540-6261.2005.00807.x  |  Cited by: 46

GREGORY R. DURHAM, MICHAEL G. HERTZEL, J. SPENCER MARTIN

Bloomfield and Hales (2002) find strong evidence that experimental market subjects are influenced by trends and patterns in a manner supportive of the shifting regimes model of Barberis, Shleifer, and Vishny (1998). We subject the model to further empirical scrutiny using the football wagering market as our price laboratory. Sports betting markets have several advantages over traditional capital markets as an empirical setting, and commonalities with traditional markets allow for useful insights. We find scant evidence that investors behave in accordance with the model.


A Note on Quantity versus Price Risk and the Theory of Financial Intermediation

Published: 12/1987,  Volume: 42,  Issue: 5  |  DOI: 10.1111/j.1540-6261.1987.tb04372.x  |  Cited by: 0

STEPHEN D. SMITH, DEBORAH WRIGHT GREGORY, KATHLEEN A. WEISS


Sufficient and Necessary Conditions for Information to have Social Value in Pure Exchange

Published: 12/1982,  Volume: 37,  Issue: 5  |  DOI: 10.1111/j.1540-6261.1982.tb03610.x  |  Cited by: 89

NILS H. HAKANSSON, J. GREGORY KUNKEL, JAMES A. OHLSON

This paper extends, corrects, and unifies earlier statements concerning the social value of public information as well as the no‐trading conditions in pure exchange. Sufficient and necessary conditions are provided for both the single‐period and two‐period cases in a postsignal trading model. The social value of information is shown to be closely linked to the allocational efficiency of the market, the degree of homogeneity of prior beliefs, and of information structures, the time‐additivity of preferences, and the efficiency of endowments. We conclude that the case in favor of public information is much stronger than previously suggested.


AN EMPIRICAL ANALYSIS OF THE FLOTATION COST OF CORPORATE SECURITIES, 1971–1972

Published: 9/1975,  Volume: 30,  Issue: 4  |  DOI: 10.1111/j.1540-6261.1975.tb01028.x  |  Cited by: 1

Keith B. Johnson, T. Gregory Morton, M. Chapman Findlay