[1]  How Do Firms Respond to Reduced Private Equity Buyout Activity? 

Abstract: I investigate how firms respond to reduced private equity buyout activity in their home states by exploiting the state-by-state adoption of laws that increase the cost of buyouts. I find evidence suggestive of reduced firm efficiency. The firms also become less likely to go bankrupt or to relocate to other states. These findings suggest that the firms' managers may be starting to enjoy the quiet life. I also find a reduction in layoffs. Overall, the results indicate a trade-off: Whereas reduced private equity buyout activity increases managerial entrenchment, it also lowers firm exits and strengthens employees' job security.

[2]  Third-Party Litigation Financing and Creative Destruction (with Clemens A. Otto)

Abstract: We study the effect of the state-by-state legalization of third-party litigation financing (TPLF) on entrepreneurs' decisions to start a new business. We find an increase in firm creation, consistent with TPLF improving entrepreneurs' access to lawsuit financing and, consequently, their ability to protect business interests. While firm exits increase as competition from new entrants intensifies, net firm creation remains positive. We also find that the innovation activities of surviving incumbents improve in quality, which suggests that competition from new entrants stimulates innovation. Net employment growth at the state level, however, declines due to layoffs among young incumbents and hiring freezes among older incumbents.

[3]  Financial Bidders and Strategic Acquirer Returns

Abstract: I examine how reduced private equity (PE) activity in the takeover market affects strategic acquirers' returns. Exploiting state-level variation in PE buyout activity in targets' home states, I find that strategic acquirers experience higher announcement returns when acquiring public targets in states with lower PE activity, consistent with reduced PE activity lowering bidding competition. When acquiring private targets, however, strategic acquirers do not experience any increase in returns. Further analyses suggest that this difference likely stems from higher search costs for private targets as PE activity declines.