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Author: Simon Döring Publisher: ISBN: Category : Languages : en Pages : 15
Book Description
We examine the role of a country's institutional framework for investment and financing activities. A country's financial structure, investor rights, and legal environment are important determinants of the relation between internal cash flow and firms' investment and financing behavior. Firms from countries with a more developed institutional framework exhibit higher financing cash flow sensitivities. These firms are more likely to substitute a cash flow shortfall with equity issues. Conversely, firms' investment-cash flow sensitivity is higher in countries with a less developed institutional framework.
Author: Simon Döring Publisher: ISBN: Category : Languages : en Pages : 15
Book Description
We examine the role of a country's institutional framework for investment and financing activities. A country's financial structure, investor rights, and legal environment are important determinants of the relation between internal cash flow and firms' investment and financing behavior. Firms from countries with a more developed institutional framework exhibit higher financing cash flow sensitivities. These firms are more likely to substitute a cash flow shortfall with equity issues. Conversely, firms' investment-cash flow sensitivity is higher in countries with a less developed institutional framework.
Author: Charlotte Ostergaard Publisher: ISBN: Category : Languages : en Pages : 52
Book Description
We study how nonlisted firms trade off financial, real, and distributive uses of cash. We show that firms' marginal value of cash (MVC) affects the mix of external and internal finance used to absorb fluctuations in cash flows; in particular, high-MVC firms employ substantially more external finance on the margin. Linking firms to their main bank, we find that shocks to bank finance affect firms' trade-offs and have real effects in high-MVC firms, making investment more sensitive to firm cash flow. Our analysis suggests that shocks to external financing costs are transmitted to the real economy via firms' marginal value of cash.
Author: Klaas Mulier Publisher: ISBN: Category : Languages : en Pages : 42
Book Description
Low cash flow volatility firms receive stronger signals about future cash flow from a given cash flow shock, yielding a larger drop in demand for external finance and their cost of external finance, implying higher investment-cash flow sensitivities (ICFS). Empirical analysis in 6 European countries confirms this. Considering firms with the same cash flow volatility, ICFS are more pronounced for financially constrained firms (cf. Fazzari et al. (1988)). Considering firms with the same level of financial constraints, ICFS are more pronounced for firms with low cash flow volatility (cf. Kaplan and Zingales (1997)). The contradictory findings in the literature may be explained by cash flow volatility.
Author: Heitor Almeid Publisher: ISBN: Category : Languages : en Pages : 28
Book Description
This paper analyzes the investment behavior of firms under a quantity constraint on the amount of external funds which can be raised at a given cost (credit constraints). In this world, investment-cash flow sensitivities decrease in the degree of credit constraints, until a firm becomes effectively unconstrained. This generates a acirc;not;SU-shapedacirc;not;? curve for the relationship between sensitivities and credit constraints. Froman empirical perspective, the good news is that we suggest a theoretically consistent way to identify the impact of financial constraints on investment behavior, at least under the condition that financial constraints affect primarily the quantity of credit available to firms. The bad news is that our prediction is in a sense the opposite as the one explored in previous empirical literature.
Author: Iwan J. Azis Publisher: Springer ISBN: 9812872841 Category : Business & Economics Languages : en Pages : 129
Book Description
This book discusses the risks and opportunities that arise in Emerging Asia given the context of a new environment in global liquidity and capital flows. It elaborates on the need to ensure financial and overall economic stability in the region through improved financial regulation and other policy measures to minimize the emergent risks. "Managing Elevated Risk: Global Liquidity, Capital Flows, and Macroprudential Policy—An Asian Perspective" also explores the range of policy options that may be deployed to address the impact of global liquidity on domestic financial and socio-economic conditions including income inequality. The book is primarily aimed at policy makers, financial market regulators and supervisory agencies to help them improve national regulatory systems and to promote harmonization of national regulations and practices in line with global standards. Scholars and researchers will also gain important information and knowledge about the overall impacts of changing global liquidity from the book.
Author: Meghana Ayyagari Publisher: World Bank Publications ISBN: Category : Business enterprises Languages : en Pages : 59
Book Description
What role does the business environment play in promoting and restraining firm growth? Recent literature points to a number of factors as obstacles to growth. Inefficient functioning of financial markets, inadequate security and enforcement of property rights, poor provision of infrastructure, inefficient regulation and taxation, and broader governance features such as corruption and macroeconomic stability are discussed without any comparative evidence on their ordering. In this paper, the authors use firm level survey data to present evidence on the relative importance of different features of the business environment. They find that although firms report many obstacles to growth, not all the obstacles are equally constraining. Some affect firm growth only indirectly through their influence on other obstacles, or not at all. Using Directed Acyclic Graph methodology as well as regressions, the authors find that only obstacles related to finance, crime, and political instability directly affect the growth rate of firms. Robustness tests further show that the finance result is the most robust of the three. These results have important policy implications for the priority of reform efforts. They show that maintaining political stability, keeping crime under control, and undertaking financial sector reforms to relax financing constraints are likely to be the most effective routes to promote firm growth.
Author: Charlotte Ostergaard Publisher: ISBN: Category : Cash flow Languages : en Pages : 0
Book Description
We study how nonlisted firms trade off financial, real, and distributive uses of cash. We show that firms' marginal value of cash (MVC) affects the mix of external and internal finance used to absorb fluctuations in cash flows; in particular, high-MVC firms employ substantially more external finance on the margin. Linking firms to their main bank, we find that shocks to bank finance affect firms' trade-offs and have real effects in high-MVC firms, making investment more sensitive to firm cash flow. Our analysis suggests that shocks to external financing costs are transmitted to the real economy via firms' marginal value of cash.
Author: Raymond Fisman Publisher: World Bank Publications ISBN: Category : Credit Languages : en Pages : 34
Book Description
Where do firms turn for financing in countries with poorly developed financial markets? One source is trade credit. And where formal financial intermediaries are deficient, industries that rely more on this source of financing grow faster.
Author: Simon Döring
Author: Simon Döring
Author: Charlotte Ostergaard
Author: Klaas Mulier
Author: Heitor Almeid
Author: Iwan J. Azis
Author: Meghana Ayyagari
Author: Charlotte Ostergaard
Author: 
Author: Raymond Fisman
Author: Heitor Almeida