Course details
Continuous-time Corporate Finance
FINA 80224A
The body of literature on continuous-time corporate finance has substantially grown over the last four decades and has been the subject of surveys and of recent reference books such as Moreno-Bromberg and Rochet (2018) and Galai et al. (2018). The course is structured around six topics: Corporate investment, capital structure, financial distress, corporate control, corporate risk management and the empirical implementation of continuous-time models. For each of these topics, the instructor will review the economic and financial questions and present the modelling approaches in the literature. Students will present one paper chosen among the selected reading list. The instructor will then organize a discussion around that presentation and the other papers in the reading list. Students will also be asked to work on a project.
Themes covered
- Corporate investments: Real options strategic exercise of real options (option games) liquidity constraints.
- Capital structure: Static trade-off agency conflicts informational asymmetry dynamic capital structure interactions with investment policy.
- Financial distress: Debt renegotiations strategic debt service bankruptcy procedure.
- Corporate control: Mergers and acquisitions industry competition.
- Corporate risk management: Risk management and firm value liquidity constraints.
- Empirical implementation: Estimation of structural models convexity bias and other issues in testing capital structure models.
Course code
FINA 80224A
Subject
Finance
Program
PhD
Instruction mode
On-site learning
Credits
3