How do resolution frameworks affect the private restructuring of distressed banks? We model a bank’s shareholders and creditors negotiating a restructuring, under two frictions: asymmetric information about asset quality, and externalities on the government. High-quality banks signal themselves by delaying...

We propose a model of financial intermediation, payments choice, and privacy in the digital economy. While digital payments enable merchants to sell goods online, they reveal information to their lender. Cash guarantees anonymity, but limits distribution to less efficient offline venues. In equilibrium, merchants...

We develop a dynamic model of a multi-asset over-the-counter (OTC) market that operates via search and bargaining and empirically test its implications regarding liquidity in the cross section of assets. The key novelty in our model is that investors can...

In a canonical takeover model we let an informed large shareholder choose between making a bid or initiating a sale to another acquirer. Such takeover activism complements direct takeovers because the very choice mitigates the asymmetric information problem, thereby improving...

We propose a new framework for understanding non-fungible tokens (NFTs), cryptoassets that typically represent digital artwork. We posit that NFTs are digital Veblen goods: consumers demand them partly because other consumers do. Demand for NFT collections is thus fragile; issuers...

A pandemic or nationalism can dial back global integration as much as advancements in IT and transportation spur it. We study a parsimonious general equilibrium model of occupational choice, risk-taking, and income inequality against backdrop of market (dis)integration and certain...