FIN504A Corporate Finance I

• Topics

  FIN504A is a course in theoretical Corporate Finance at the Ph.D. level. Lectures are based primarily on the textbook "Theory of Corporate Finance" by J. Tirole. The course will cover fundamental topics in corporate finance such as the effect of agency problems and asymmetric information on the firm's choice of funding source, the design of securities, and the choice of debt maturity structure. The course will also study how corporate monitoring may reduce agency costs and how consumer liquidity demand may lead to bank runs.

  More specifically, the topics to be covered are the following:

  • Capital Structure: Modigliani and Miller
  • Agency Considerations in Corporate Finance
  • Corporate Governance and Control
  • Optimal Security Design
  • Debt Structure and Seniority
  • Asymmetric Information and Signaling
  • Corporate and consumer liquidity
  • Theory of the Firm

• Learning outcome

  The candidate will on successfully completing the course, is able to:

  Knowledge:

  • explain the fundamental concepts in advanced corporate finance theory
  • relate theoretical concepts in corporate finance to relevant empirical research

  Skills:

  • explain intuitively as well as mathematically the topics covered
  • effectively read and discuss research papers in corporate finance theory
  • explain different empirical settings used to test corporate finance theories
  • expand on some of the topics to the level of developing own research ideas

• Teaching

  Regular lectures.

• Restricted access

  PhD candidates from NHH as well as PhD candidates from other institutions can take part in the course.

• Required prerequisites

  Good knowledge of finance and microeconomic concepts & tools at the intermediate level.

• Assessment

  Two individual assignments each weighting 50%

  Re-take is offered the semester after the course was offered for students who signed up for the initial evaluation.

• Grading Scale

  Grading scale A - F.

• Computer tools

  none

• Literature

  Jean Tirole (2005), The Theory of Corporate Finance

  In addition, a number of articles will be assigned.