Date of Award


Degree Name

Doctor of Philosophy



First Advisor

Dr. Mark Wheeler

Second Advisor

Dr. James C. Hueng

Third Advisor

Dr. Mark Wohar


Financial intermediation, risk, delisting, economic uncertainty


In the wake of our country’s greatest financial crisis since the Great Depression, the need to better understand the risks and behaviors associated with financial intermediaries has become apparent. In particular, the literature distinguishes between traditional or depository-based financial intermediaries and their market-based or non-depository counterparts. This dissertation focuses on understanding the behavioral differences across these two groups by examining their equity-based risk differences, their stock market delisting differences, and lastly how these firms react to economic policy uncertainty.

The first essay uses an equity-based approach to quantify the average firm-level risk that is associated with these intermediary groups. While these intermediaries, at times, demonstrate similar risk behaviors, the market-based financial intermediaries display a distinct ten-year period of greater risk beginning in 1994. Since the 1980’s there has been a trend of increasing financial market instability that is commonly attributed to increasing competition, securitization, and deregulation. Using a historical decomposition approach, I analyze which of these factors best explains the changing relative risk behaviors across the traditional and market-based intermediaries. The most important factor in driving these behaviors was deregulation, with competition also having a significant impact.

The second essay examines the stock market survival behavior of each of these respective groups and the role that risk plays in explaining delisting due to firm failure, as well as merger and acquisition activity. Using survival analysis, the delisting behavior of these intermediaries is examined where the market-based firms are more likely to delist relative to the traditional firms due to both firm failure and M&A activity. Additionally, idiosyncratic risk is found to have a statistically significant impact in driving these behaviors.

The last essay focuses on how each of these intermediary groups alters their balance sheet in the face of economic uncertainty. Specifically, I examine how the debt-financing behavior of these firms reacts to an economic policy uncertainty shock using a macroeconomic approach. The key results, from the impulse response and variance decomposition analysis, indicate that market-based financial intermediaries tend to have faster responses to policy uncertainty relative to traditional intermediaries, however the small traditional financial intermediaries have the largest response.

Access Setting

Dissertation-Open Access