| This dissertation is a collection of essays that analyze initial public offerings (IPO), and bank mergers in the US market. I model both IPO and bank mergers as a two sided competitive matching market in such a way that issuer firms and investment banks in the IPO market, and buyer banks and target banks in the merger market obtain a match surplus upon matching, and share this value according to market equilibrium rules. Like in the marriage market, which is the biggest matching market, agents look for their matches to maximize their own benefits. I impose functional forms that specify the surplus and recover the parameters by using novel econometric methods. The purpose in doing so is to quantify the sorting in matched partners' characteristics. The IPO essay seeks to identify what percent of the matching partners' performance is attributable to sorting and what percent comes from the real value added effect of the partners' characteristics, whereas the bank merger essay uses the sorting in answering the question of what attributes of banks play role in merger decisions. |
