Cline, Brandon N.; Garner, Jacqueline L.; Yore, Adam S. - In: Journal of Corporate Finance 25 (2014) C, pp. 234-250
Internal capital markets (ICMs) provide firms an alternative to costly external financing; however, they also provide … internal capital markets will avoid outside financing. Consistent with this view, conglomerates that cross-subsidize divisions … announcement returns that are, on average, 1% more negative than firms operating more efficient internal capital markets. …