This study investigates the relation between the use of compensation consultants and CEO pay levels. Using new proxy statement disclosures from 2,116 companies, we examine claims that pay is higher in clients of compensation consultants, and test whether any pay differences in users and non-users of consultants are due to differences in economic or corporate governance characteristics. We find that CEO pay is generally higher in clients of most consulting firms, even after controlling for economic determinants of compensation. However, when users and non-users are matched on both economic and governance characteristics, differences in pay levels are not statistically significant. These results are consistent with claims that compensation consultants provide a mechanism for CEOs of companies with weak governance to extract and justify excess pay. Finally, we find no support for claims that CEO pay is higher in conflicted consultants that also offer additional non-compensation related services.

Private equities are an important and growing part of the worldwide capital markets, and include early stage investments, often backed by venture capital. In the article "Venture-Backed Private Equity Valuation and Financial Statement Information," Professors Antonio Dávila of IESE, and George Foster and Chris Armstrong of Stanford analyze how financial statement information impacts the valuation of firms by private equity investors in the U.S. market. What they find is that it plays a significant role in explaining changes in market value.

We are still seeking to understand the astonishing rise and then sharp fall of U.S. stock prices in 2000. The paper "U.S Public and Private Venture Capital Markets, 1998-2001," describes what happened in a new light, by looking through the lens of underlying company financial fundamentals. The research reveals some important insights. For instance, contrary to popular belief, there was no single "bubble point" at which U.S. capital markets realized that a large number of publicly traded companies had little substance. Also, four sectors in particular - computer hardware and software, telecommunications and biotech/pharmaceuticals - felt the boom and then the bust even harder.