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Essays in Macroeconomics and Corporate Finance.

紀錄類型:	書目-語言資料,手稿 : Monograph/item
正題名/作者:	Essays in Macroeconomics and Corporate Finance./
作者:	Meehl, April.
面頁冊數:	1 online resource (123 pages)
附註:	Source: Dissertations Abstracts International, Volume: 85-11, Section: A.
Contained By:	Dissertations Abstracts International85-11A.
標題:	Finance. -
電子資源:	click for full text (PQDT)
ISBN:	9798382405490

Essays in Macroeconomics and Corporate Finance.
Meehl, April.

Essays in Macroeconomics and Corporate Finance. - 1 online resource (123 pages)

Source: Dissertations Abstracts International, Volume: 85-11, Section: A.

Thesis (Ph.D.)--The University of Wisconsin - Madison, 2024.

Includes bibliographical references

In the first chapter, I study how big banks' expectations of bailouts and bail-ins affect their individual decisions and the consequences for the aggregate banking industry. Unlike bailouts, bail-ins use internal bank funds instead of government money to stabilize distressed banks. The expectation of bail-in influences the pricing of bank debt and equity, prompting banks to adjust their balance sheets accordingly. To assess the impact, I construct a quantitative model of heterogeneous bank dynamics and estimate it to match aggregate and distributional moments from the pre-GFC U.S. banking sector. In a scenario where bail-ins replace bailouts, uninsured debt prices rise, diminishing the advantages of being a large bank. Ex-ante riskier banks see the most significant changes in debt prices, resulting in fewer becoming large banks and a substantial decrease in the failure rate of large banks by 77%. Increased entry to meet firm demand for loans limits the drop in aggregate lending to only 3.3%. Ex-ante safer banks increase their share of lending, enhancing overall banking sector efficiency.In the second chapter (joint with Shannon Sledz), I study the impact of the Federal Reserve's Primary Market Corporate Credit Facilities (PMCCF) on acquisition activity. Following the announcement of the PMCCF, firms with credit ratings issued a record-breaking number of bonds. An acquisition wave soon followed. We construct a dataset of firm characteristics, bond issuances, acquisition activity, and stock returns to study the connection between these two events. Using a differences-in-differences approach, we find no significant difference in the acquisition likelihood of firms whose bonds were eligible for purchase by the Federal Reserve. By studying the stock returns surrounding the announcement of these acquisitions, we find suggestive evidence that acquisitions made by eligible firms after the PMCCF were perceived more favorably by the market than acquisitions by similar firms in the pre-period.The third chapter dives into the efficiency of the banking sector over two decades of regulatory and technological change. By adapting the allocative efficiency measure in Olley and Pakes (1996), I define default rate allocative efficiency as the covariance between a bank's default rate on its loans and its share of lending in the economy. Using Call Report data, I find that aggregate default rate allocative efficiency is positive for US banks from 1992-2021, suggesting that more loans are made by banks with higher defaults on their loans. However, C&I default rate allocative efficiency becomes negative following the GFC. In fact, the positive relationship between default rates and share of lending is weakened for large banks in the post-GFC period for all types of loans. In an illustrative model, I show that this finding is consistent with the reduction in bailout expectations for banks.

Electronic reproduction.
Ann Arbor, Mich. :
ProQuest,
2024

Mode of access: World Wide Web

ISBN: 9798382405490Subjects--Topical Terms:

559073
Finance.
Subjects--Index Terms:

Bail-insIndex Terms--Genre/Form:

554714
Electronic books.

Essays in Macroeconomics and Corporate Finance.
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500 $a Source: Dissertations Abstracts International, Volume: 85-11, Section: A.
500 $a Advisor: Corbae, Philip Dean.
502 $a Thesis (Ph.D.)--The University of Wisconsin - Madison, 2024.
504 $a Includes bibliographical references
520 $a In the first chapter, I study how big banks' expectations of bailouts and bail-ins affect their individual decisions and the consequences for the aggregate banking industry. Unlike bailouts, bail-ins use internal bank funds instead of government money to stabilize distressed banks. The expectation of bail-in influences the pricing of bank debt and equity, prompting banks to adjust their balance sheets accordingly. To assess the impact, I construct a quantitative model of heterogeneous bank dynamics and estimate it to match aggregate and distributional moments from the pre-GFC U.S. banking sector. In a scenario where bail-ins replace bailouts, uninsured debt prices rise, diminishing the advantages of being a large bank. Ex-ante riskier banks see the most significant changes in debt prices, resulting in fewer becoming large banks and a substantial decrease in the failure rate of large banks by 77%. Increased entry to meet firm demand for loans limits the drop in aggregate lending to only 3.3%. Ex-ante safer banks increase their share of lending, enhancing overall banking sector efficiency.In the second chapter (joint with Shannon Sledz), I study the impact of the Federal Reserve's Primary Market Corporate Credit Facilities (PMCCF) on acquisition activity. Following the announcement of the PMCCF, firms with credit ratings issued a record-breaking number of bonds. An acquisition wave soon followed. We construct a dataset of firm characteristics, bond issuances, acquisition activity, and stock returns to study the connection between these two events. Using a differences-in-differences approach, we find no significant difference in the acquisition likelihood of firms whose bonds were eligible for purchase by the Federal Reserve. By studying the stock returns surrounding the announcement of these acquisitions, we find suggestive evidence that acquisitions made by eligible firms after the PMCCF were perceived more favorably by the market than acquisitions by similar firms in the pre-period.The third chapter dives into the efficiency of the banking sector over two decades of regulatory and technological change. By adapting the allocative efficiency measure in Olley and Pakes (1996), I define default rate allocative efficiency as the covariance between a bank's default rate on its loans and its share of lending in the economy. Using Call Report data, I find that aggregate default rate allocative efficiency is positive for US banks from 1992-2021, suggesting that more loans are made by banks with higher defaults on their loans. However, C&I default rate allocative efficiency becomes negative following the GFC. In fact, the positive relationship between default rates and share of lending is weakened for large banks in the post-GFC period for all types of loans. In an illustrative model, I show that this finding is consistent with the reduction in bailout expectations for banks.
533 $a Electronic reproduction. $b Ann Arbor, Mich. : $c ProQuest, $d 2024
538 $a Mode of access: World Wide Web
650 4 $a Finance. $3 559073
653 $a Bail-ins
653 $a Bailouts
653 $a Corporate bonds
653 $a Efficiency
653 $a Macroeconomics
653 $a Corporate finance
655 7 $a Electronic books. $2 local $3 554714
690 $a 0501
690 $a 0508
690 $a 0770
710 2 $a The University of Wisconsin - Madison. $b Economics. $3 1184399
710 2 $a ProQuest Information and Learning Co. $3 1178819
773 0 $t Dissertations Abstracts International $g 85-11A.
856 4 0 $u http://pqdd.sinica.edu.tw/twdaoapp/servlet/advanced?query=31243709 $z click for full text (PQDT)