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BENJAMIN G. MATHEW
EDUCATION
| Ph.D. |
Economics |
University of Chicago |
Expected June 2008 |
| A.B. |
Economics |
Dartmouth College |
June 1998 |
FIELDS
| Corporate Finance, Industrial Organization, Labor Economics |
| Topics: Mergers, Theory of the Firm, Capital Structure, CEO Pay, Volatility |
DISSERTATION
Stock Performance and Merger Choices
Firms that have experienced recent gains in the stock market are more likely to engage in deals that redraw their boundaries - whether by acquiring other firms, being acquired themselves, or by doing spinoffs. Merging firms also appear to match assortatively by stock performance: successful firms merge with other successful firms. I show how both these patterns arise naturally in a model where reorganization imposes nontrivial costs.
Assortative matching by stock performance is difficult to test directly. Showing that industry and time adjusted stock returns of merger partners are positively correlated is not sufficient. This is because the correlation could be driven by unmeasured operational similarities between merger partners rather than by similarity of financial performance per se. I propose another test for assortative matching based on market reactions to merger announcements. If firms sort by performance, and performance is not perfectly observed, then merger announcements will convey information to the market about the performance of firms. The market response to a firm announcing a merger would be increasing in its proposed partner's performance (since that is an indication that the firm itself is of high quality). And, holding constant the performance of the merger partner, the market response would be declining in the firm's own past performance (since that is an indication that the firm was previously overvalued). I find empirical support for this effect in the market response to merger announcements.
OTHER PAPERS
Volatility, Human Capital and CEO Pay. Working Paper.
Why Don't More Leveraged Firms Have More Volatile Stock? Working Paper.
The Coordinating Role of Firms. Working Paper.
Why Do Public Enterprises and Protected Private Monopolies Have Inflated Costs? Working Paper.
TEACHING EXPERIENCE
University of Chicago
| Microeconomics |
Undergraduate |
Lecturer |
Aut 2004 |
| Price Theory I |
Ph.D. Program |
TA for Professors Gary Becker and Kevin Murphy |
Aut 2003 |
| Price Theory III |
Ph.D. Program |
TA for Professor Pierre-Andre Chiappori |
Spr 2003 |
| Price Theory II |
Ph.D. Program |
TA for Professors Philip Reny and Hugo Sonnenschein |
Win 2003 |
REFEREEING
Journal of Political Economy
WORK EXPERIENCE
| Research Analyst |
Investor Responsibility Research Center |
Washington DC |
2000 |
| Research Analyst |
LECG |
Washington DC |
1998-’99 |
PRIZES AND HONORS
| Martin and Margaret Lee Prize for the best Price Theory core exam |
University of Chicago |
2002 |
| Honors in Economics |
Dartmouth College |
1998 |
| M.J. and K.M. Remsen Scholarship |
Dartmouth College |
1994-’98 |
FELLOWSHIPS
| Esther and T.W. Schultz Endowment Fund Dissertation Fellowship |
University of Chicago |
2006-’07 |
| John M. Olin Foundation Dissertation Fellowship |
University of Chicago |
2005-’06 |
| Sherwin Rosen Fellowship |
University of Chicago |
2003-’05 |
REFERENCES
