Relevance or irrelevance of capital structure?

In this paper we examine the effects of asymmetric information on the nature of financial equilibrium and on the capital structure of firms. In the first model presented, the financial contracts on offer involve pooling equilibrium with no adverse selection. However, in the special case analyzed, where contracts are of mixed form, there may be a separating equilibrium and also equilibrium may not exist. Interesting result is that the separating equilibrium found is not economically efficient since aggregate investments falls short of first-best level. More importantly, capital structure does matter. The relative magnitude of outside equity makes a real difference to the quantity of aggregate investment in equilibrium

Relevance or irrelevance of capital structure?

In this paper we examine the effects of asymmetric information on the nature of financial equilibrium and on the capital structure of firms. In the first model presented, the financial contracts on offer involve pooling equilibrium with no adverse selection. However, in the special case analyzed, where contracts are of mixed form, there may be a separating equilibrium and also equilibrium may not exist. Interesting result is that the separating equilibrium found is not economically efficient since aggregate investments falls short of first-best level. More importantly, capital structure does matter. The relative magnitude of outside equity makes a real difference to the quantity of aggregate investment in equilibrium

The performance of credit markets under asymmetric information about project means and variances

SIGLEAvailable from British Library Document Supply Centre-DSC:5281.1848(9306) / BLDSC - British Library Document Supply CentreGBUnited Kingdo

Credit, money and the government budget constraint

SIGLEAvailable from British Library Document Supply Centre-DSC:5281.1848(9305) / BLDSC - British Library Document Supply CentreGBUnited Kingdo

Identifying eIF4E-binding protein translationally-controlled transcripts reveals links to mRNAs bound by specific PUF proteins

eIF4E-binding proteins (4E-BPs) regulate translation of mRNAs in eukaryotes. However the extent to which specific mRNA targets are regulated by 4E-BPs remains unknown. We performed translational profiling by microarray analysis of polysome and monosome associated mRNAs in wild-type and mutant cells to identify mRNAs in yeast regulated by the 4E-BPs Caf20p and Eap1p; the first-global comparison of 4E-BP target mRNAs. We find that yeast 4E-BPs modulate the translation of >1000 genes. Most target mRNAs differ between the 4E-BPs revealing mRNA specificity for translational control by each 4E-BP. This is supported by observations that eap1Δ and caf20Δ cells have different nitrogen source utilization defects, implying different mRNA targets. To account for the mRNA specificity shown by each 4E-BP, we found correlations between our data sets and previously determined targets of yeast mRNA-binding proteins. We used affinity chromatography experiments to uncover specific RNA-stabilized complexes formed between Caf20p and Puf4p/Puf5p and between Eap1p and Puf1p/Puf2p. Thus the combined action of each 4E-BP with specific 3′-UTR-binding proteins mediates mRNA-specific translational control in yeast, showing that this form of translational control is more widely employed than previously thought