The three day conference saw a mélange of papers on various relevant and absorbing themes in Corporate Finance – from e-loans to bankruptcy codes to impact of leveraged buyouts (LBO) on product availability to corporate control motivations and capital structure decisions etc.

The conference was divided into different sessions- Financing channels, Impact of legal institutions on financing and investments, Role of controlling shareholders, Managerial incentives, Corporate governance, and Corporate restructuring.

Is there favouritism in capital allocation, what is the relation between corruption and competition, does better corporate governance cause better firm performance , do business groups use dividends to fund investments etc - these were some of the issues that were debated at the conference.

In their paper Corruption and Competition, Franklin Allen (University of Pennsylvania) and Jun “QJ” Qian (Boston College), maintained that an interesting aspect of corruption is that its damaging effects on economic growth seem to differ significantly across countries. Corruption occurs when the government cannot raise sufficient revenues to finance costly provision of public goods, and bribes can be regarded as user fees. With multiple officials providing the same good or service, the user fee is determined competitively, and the pernicious effects of corruption are minimized. The authors also threw light on how economic agents and the central government can restrain corrupt officials.

Jarrad Harford (University of Washington), Dirk Jenter (Massachusetts Institute of Technology and NBER) and Kai Li (University of British Columbia, presented a paper entitled Conflict of Interests among Shareholders; the case of Corporate Acquisitions. The paper identified important conflicts of interests among shareholders and examined their effects on corporate decisions. They concluded that conflicts of interests among shareholders are sizeable and, at least in the case of acquisitions, affect managerial decisions.


David A Matsa (Kellogg) presented a paper on Operating under a Liquidity Crunch: The impact of LBO’s on product availability in the supermarket industry. This paper examines how leveraged buyouts affect a supermarket’s provision of product availability — an important dimension of service in the retail sector.

Papers selected for the Conference