Stefanie Kleimeier

New Publication

Bank loans are an important source of finance for innovative firms, but involve moral hazard problems driven by a heightened level of information asymmetry between the borrower and lender.

In our paper "How do banks finance R&D intensive firms? the role of patents in overcoming information asymmetry" in Finance Research Letters, Arvid Hoffmann (Adelaide University) and I find that in syndicated loan arrangements, lead arrangers need to retain a larger share of the loan when an innovative borrower (i.e., R&D intensive firm) is involved, but show that patents can overcome this necessity. By retaining a larger lending share, lead arrangers signal to participant lenders their incentive to exert the necessary effort in due diligence and monitoring of borrowers with high information asymmetry. However, patents are a signal of successful outcomes of the otherwise intangible innovation process, reducing a borrower's cash flow volatility and R&D payoff uncertainty, suggesting that less due diligence and monitoring efforts are required and moral hazard is lower.

New Publication

Despite awareness of the detrimental impact of CO2 pollution on the world climate, countries vary widely in how they design and enforce environmental laws.

In our paper "Exporting Pollution: Where Do Multinational Firms Emit CO2?" in Economic Policy, Itzhak Ben-David (Ohio State University & NBER), Yeejin Jang (University of New South Wales), Michael Viehs (Federated Hermes International) and I explore how firms respond to environmental regulation.

Using novel microdata about multinational firms' CO2 emissions across countries, we document that firms headquartered in countries with strict environmental policies perform their polluting activities abroad in countries with relatively weaker policies. These effects are largely driven by tightened environmental policies in home countries that incentivize firms to pollute abroad rather than lenient foreign policies that attract those firms. Although firms headquartered in countries with strict domestic environmental policies are more likely to export pollution to foreign countries, they nevertheless emit somewhat less overall CO2 globally.

Special section in the Journal of Banking and Finance

In its April 2020 issue, the Journal of Banking and Finance dedicates a special section to ‘Financial Globalization and Its Spillovers’.

The papers included in this special section originate from a Jean Monnet Workshop on “Financial globalization and its spillovers - monetary and exchange rate policy in times of crises” held in Cologne and Maastricht on February 16-17, 2017 co-organized by Maastricht University, TH Köln, University Duisburg-Essen,and Ruhr-University Bochum.