Optimal choice of contracting methods: negotiated versus competitive underwritings revisited

We use a previously unexploited data base, specifically debt offerings by A T&T and its subsidiaries in the period 1970-1974, to examine the relative c ostliness of competitive and negotiated offerings. A sample based on the ex perience of a single issuer allows us to minimize the influence of agency c onsiderations and differential riskiness of the issuers. We find no systema tic ex post cost difference, and we also find that negotiation was chosen d uring comparatively unsettled times. (C) 1999 Elsevier Science S.A. All rig hts reserved.