Essays on corporate board structure, financial syndication, and organizational structure

This dissertation consists of three essays. The first essay studies the effects of Corporate Board Structure on managerial self-dealing. A Unitary Board Structure is modeled as a situation in which a CEO reports to a single principal who is in charge of both monitoring and establishing performance targets, while a dual board structure is modeled as a situation in which the CEO reports to two distinct principals, one who is in charge of establishing performance targets for the company and the other who is in charge of monitoring activities. It is shown that a dual structure improves on the monitoring task but at a cost: the CEO, when compared to a unitary structure, is demanded less aggressive performance targets. The latter effect reduces the amount of productive effort exerted by the manager. Moreover, as performance targets and effort toward self-dealing activities are substitutes, the effect of a dual structure on self-dealing activities is ambiguous in spite of the increased monitoring. The second essay considers the collusive motive for syndication in financial markets. We consider a setting in which a group of lenders who are privately informed regarding their capability of monitoring an entrepreneur must decide whether to provide the loan collectively, or individually in a competitive fashion. We show that if the negotiation stage is robust to the timing of communication of their private information, and if the lenders believe it is better to agree on a collective deal than to compete, positive participation in the loan is given to all lenders (i.e., syndication ensues) even when side payments are allowed. The third essay studies the effects of the existence of non-contractible benefits on the overall matching of workers and firms across the Economy, as well as the effect of the latter on the firm's internal organization. It is shown that (i) the monotonic assignment of workers' talents to firms' productivities increases the occurrence of an efficient organizational structure, and (ii) the existence of non-contractible benefits and the resulting organizational inefficiencies may lead, if extremely talented workers exist in the Economy, to matchings which are not monotonic.