Hedging, Contract Enforceability, and Competition
研究美国寿险业中，降低对冲成本的州级改革如何影响企业风险管理和竞争，发现面临高外部融资成本的企业增加对冲、降低风险，并降价扩大市场份额。
Abstract We study how risk management through hedging affects firms and competition among firms in the life insurance industry, an industry with over 7 trillion in assets and over 1,000 private and public firms. We examine firms after a staggered state-level reform that reduces the costs of hedging by granting derivatives superpriority in case of insolvency. We show that firms that are likely to face costly external finance increase hedging and reduce risk and the probability of receivership. Firms that are likely to face costly external finance also lower prices, increase policy sales, and increase their market share post-reform.