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This study explores the association between risk retention by originators (skin in the game) and the performance of securitized assets. We combine hand-collected and publicly available data on 85 Brazilian receivable funds with a single originator from January 2013 to December 2020. We find that skin in the game is a buffer against observable risks in accordance with the buffer hypothesis, although the reputation of originators that are financial institutions in the loan market can alleviate moral hazard concerns. For funds with fintech originators, the opposite holds: enhancements are indeed a signal against the unobservable quality of receivables. [ABSTRACT FROM AUTHOR]

This paper analyzes whether the higher the company's financial leverage, the higher the salaries demanded by staff for the embedded financial distress risk. By applying Berk, Stanton and Zechner's (2010) model, we use a 2SLS for a sample of 250 non-financial companies listed on BOVESPA from 2007 to 2009. Indeed, we find that for each additional 1% of financial leverage, the staff remunerations increase by 0.26%, controlling for Chief Executive Officer (CEO) profile. [ABSTRACT FROM AUTHOR]

This article compares capital budgeting techniques employed in listed and unlisted companies in Brazil. We surveyed the Chief Financial Officers (CFOs) of 398 listed companies and 300 large unlisted companies, and based on 91 respondents, the results suggest that the CFOs of listed companiestend to use less simplistic methods more often, for example: NPV and CAPM, and that CFOs of unlisted companies are less likely to estimate the cost of equity, despite being large companies. These findings indicate that stock exchange listing may require greater sophistication of the capital budgeting process. [ABSTRACT FROM AUTHOR]