Essays on the structural estimation and analysis of corporate and industrial markets

The three chapters which comprise my thesis are a collection of essays on the analysis of the corporate governance and airline markets and of the federal appellate structure. In Chapter 1, I use a discrete choice framework to analyze state design and firm choice of the implications of incorporation: corporate governance laws, corporate taxes and court structure. Firms - differentiated on ownership, management, industry concentration, financial profile and unobservable dimensions - freely choose their preferred state of incorporation or reincorporation. The revealed preference embedded in this observable choice is used as window into the heterogeneous preferences within and across firms, yielding several findings: For example, I find, surprisingly, that firms are very responsive to incorporation and franchise taxes. In addition, on average, firms like anti takeover statutes, but, consistent with an agency story, firms with an institutional shareholder block and venture capital backed firms dislike them. On average, firms dislike mandatory governance statutes restricting managerial power and facilitating the representation of minority shareholders, but these laws are less restrictive for the choice of firms in concentrated industries. All firms dislike well functioning courts, consistent with a litigation deterrence motive. The recovered firm preferences are then taken to the simulation of recently proposed federal reforms aimed at centralizing the domicile implications and restricting firm choice.

Department dc:contributor.department

Massachusetts Institute of Technology. Dept. of Economics.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2009

Author dc:creator

• Cohen, Moshe Aharon

Advisor dc:contributor.advisor

• Glenn Ellison, Whitney Newey and Victor Chernozhukov.

• Economics.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/54640

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/54640