This is a master's course of corporate finance.
This course will follow recent literature in discussing central topics of corporate finance such as corporate governance, capital structure, valuation, mergers and acquisitions, and behavioral corporate finance. In particular, the course will focus on empirical studies in these fields. Students discuss actual business cases related to the above topics.
The goal is to understand the fundamentals of corporate finance so that class participants can start their own researches in this field and other related fields such as investment, corporate management, and accounting.
Corporate Finance, Corporate Governance, Asset Pricing, Mergers and Acquisitions
✔ Specialist skills | ✔ Intercultural skills | ✔ Communication skills | ✔ Critical thinking skills | ✔ Practical and/or problem-solving skills |
All the students are expected to read all the assigned papers. Each student will be assigned several papers in the following reading list. The number of assigned paper per student will depend on the class size. The assigned students are expected to read and analyze the paper carefully and prepare presentation about the paper and lead discussion. Other students are expected to read the paper and prepare discussion. In the final two classes, students will discuss cases to have a sense how implications from academic researches and real businesses interact.
Course schedule | Required learning | |
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Class 1 | Introductionary Lecture: Efficient market and Corporate Finance | (Reference Paper) Fama (1991) Efficient Market ii http://www.jstor.org/stable/2328565 |
Class 2 | Theory and Practice Graham, J. and C. Harvey (2001) “The theory and practice of corporate finance: Evidence from the field” Journal of Financial Economics 60, 187-243 | Graham, J. and C. Harvey (2001) “The theory and practice of corporate finance: Evidence from the field” Journal of Financial Economics 60, 187-243 http://faculty.fuqua.duke.edu/~jgraham/website/SurveyPaper.PDF |
Class 3 | Law and Finance La Porta et al. (1998) “Law and Finance” | (Assigned Paper) La Porta et al. (1998) “Law and Finance” http://onlinelibrary.wiley.com/doi/10.1111/1540-6261.00457/pdf |
Class 4 | Corporate Governance Gompers, P.A., J.L.Ishii, and A.Metrick (2003) Corporate Governance and Equity Prices | (Assigned paper) Gompers, P.A., J.L.Ishii, and A.Metrick (2003) Corporate Governance and Equity Prices http://papers.ssrn.com/sol3/papers.cfm?abstract_id=278920 |
Class 5 | CEO Bertrand and Mullainathan (2003) Enjoying the Quiet Life? Corporate Governance and Managerial Preferences | (Assigned Paper) Bertrand and Mullainathan (2003) Enjoying the Quiet Life? Corporate Governance and Managerial Preferences http://dash.harvard.edu/bitstream/handle/1/3429713/Mullainathan_EnjoyingQuietLife.pdf?sequence=2 |
Class 6 | Management and Firm Performance Nicholas Bloom and John Van Reenen, (2007) Measuring and Explaining Management Practices Across Firms and Countries, Quarterly Journal of Economics 122 (4): 1351-1408. | (Assigned Paper) Nicholas Bloom and John Van Reenen, (2007) Measuring and Explaining Management Practices Across Firms and Countries, Quarterly Journal of Economics 122 (4): 1351-1408. http://www.stanford.edu/~nbloom/MeasuringManagement.pdf |
Class 7 | Managerial Compensation Cai and Vijh (2007), Incentive Effects of Stock and Option Holdings of Target and Acquirer CEOs, Journal of Finance | (Assigned Paper) Cai and Vijh (2007), Incentive Effects of Stock and Option Holdings of Target and Acquirer CEOs, Journal of Finance http://faculty.lebow.drexel.edu/CaiJ/JF2007.pdf |
Class 8 | Large Shareholders Jay Dahyaa, J., O. Dimitrovb, J.J. McConnell (2008) Dominant shareholders, corporate boards, and corporate value: A cross-country analysis | (Assigned Paper) Jay Dahyaa, J., O. Dimitrovb, J.J. McConnell (2008) Dominant shareholders, corporate boards, and corporate value: A cross-country analysis http://www.sciencedirect.com/science/article/pii/S0304405X07001389 |
Class 9 | Managerial Overconfidence Malmendier and Tate (2005), CEO Overconfidence and Corporate Investment, Journal of Finance, 2005, 60, 2261-2700 | (Assigned Paper) Malmendier and Tate (2005), CEO Overconfidence and Corporate Investment, Journal of Finance, 2005, 60, 2261-2700 http://www.nber.org/papers/w10807 |
Class 10 | Cash Holdings Opler, T., L. Pinkowitz, R. M. Stulz, and R. Williamson (1999), “The Determinants and Implications of Corporate Cash Holdings,”Journal of Financial Economics 52 (1), 3-46. | (Assigned Paper) Opler, T., L. Pinkowitz, R. M. Stulz, and R. Williamson (1999), “The Determinants and Implications of Corporate Cash Holdings,”Journal of Financial Economics 52 (1), 3-46. http://fisher.osu.edu/supplements/10/10402/Determinants-cash-holdings.pdf |
Class 11 | Initial Public Offering Derrien and Womack (2003), "Auctions vs. Bookbuilding and the Control of Underpricing in Hot IPO Markets,'' Review of Financial Studies, 16 (1), 31-61. | (Assigned Paper) Derrien and Womack (2003), "Auctions vs. Bookbuilding and the Control of Underpricing in Hot IPO Markets,'' Review of Financial Studies, 16 (1), 31-61. http://www.jstor.org/stable/i253959 |
Class 12 | Mergers and Acquisitions Jesse Ellis, Sara B. Moeller, Frederik P. Schlingemann, René M. Stulz (2012) Globalization, Governance, and the Returns to Cross-Border Acquisitions | (Assigned Paper) Jesse Ellis, Sara B. Moeller, Frederik P. Schlingemann, René M. Stulz (2012) Globalization, Governance, and the Returns to Cross-Border Acquisitions http://www.erim.eur.nl/fileadmin/erim_content/documents/EMSS_May_31_Final.pdf |
Class 13 | Innovation JAN BENA and KAI LI(2014) “Corporate Innovations and Mergers and Acquisitions,” Journal of Finance 69(5) | (Assigned Paper) JAN BENA and KAI LI(2014) “Corporate Innovations and Mergers and Acquisitions,” Journal of Finance 69(5) http://onlinelibrary.wiley.com/doi/10.1111/jofi.12059/pdf |
Class 14 | Case 1: Seagate Technology Buyout Topic: Efficient Market and Behavioral Corporate Finance To be distributed in the class. | Prepair for case discussion in the class |
Class 15 | Case 2: HOYA and Pentax Topic: Mergers and Acquisitions, Board of Directors, Large Shareholders To be distributed in the class. | Prepair for case discussion in the class |
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Principles of Corporate Finance, Brealey, Myers, and Allen, McGraw-Hill
The grade of this course is based on the report for the assigned paper and discussion participation (80%), and class participation in the case study classes (20%).
Participants are expected to have basic knowledge of finance such as capital assets pricing model (CAPM) beforehand.