Publications from the department of finance

Journal of Empirical Finance 89 p. 1-13 Doi: https://doi.org/10.1016/j.jempfin.2026.101778

We use the “last days of LIBOR,” the period leading up to the final publication of the London Interbank Offered Rate (LIBOR), to study how financial markets adapt to changes imposed by regulators. Focusing on interest rate derivatives, we find that regulatory changes that alter contractual cash flows are quickly reflected in prices. Prices initially overreact, with the response extending to contracts whose cash flows are unaffected, consistent with fire sales by levered investors. Regulatory surprises also have persistent effects, with market prices implying a higher perceived probability of further policy changes. Our findings provide evidence on how markets respond to policy interventions.

Samfunnsøkonomen 140(4) p. 99-118 Doi: https://doi.org/10.18261/sam.140.4.1

Journal of Money, Credit and Banking Doi: https://doi.org/10.1111/jmcb.70105

Growth in household debt-to-income ratios can be attributed to nominal debt changes or “Fisher dynamics” due to interest income and expenses, real income growth, and inflation. With microdata covering the universe of Norwegian households for more than 20 years, we decompose the importance of these channels for how debt-to-income ratios evolve over time and respond to monetary policy shocks. On average, debt changes outsize Fisher dynamics, but among highly leveraged households Fisher dynamics dominate. After interest rate hikes, debt changes and Fisher dynamics pull in opposite directions, with the former dominating, leading to a decline in debt-to-income ratios. This pattern is consistent across sub-groups, including highly indebted households, recent movers, households facing liquidity constraints, and households facing high unemployment risk.

Journal of Corporate Finance p. 103100-103100 Doi: https://doi.org/10.1016/j.jcorpfin.2026.103100

We study how firms choose to allocate control over strategic corporate decisions between shareholders and management in a historical setting where governance design was not mandated by corporate law, but ownership structures were constrained by differences in regional wealth distributions. The general shareholder meeting is the dominant governance body, retaining control over the largest number of strategic decisions. Nevertheless, firms with a predominance of small —and plausibly less informed— shareholders empower managers by delegating control over a larger number of strategic decisions to them. Furthermore, shareholder empowerment is accompanied by statutory provisions that facilitate information acquisition, suggesting that control and information are complements. Our findings highlight that the debate on shareholder empowerment should account for the role of ownership structure and information as key determinants of the allocation of control between shareholders and management.

Review of Economic Studies Doi: https://doi.org/10.1093/restud/rdag087