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Credit Ratings as Coordination Mechanisms

Boot, Arnoud W. A.; Milbourn, Todd T. - William Davidson Institute, University of Michigan - 2002

In this paper, we provide a novel rationale for credit ratings. The rationale that we propose is that credit ratings can serve as a coordinating mechanism in situations where multiple equilibria can obtain. We show that credit ratings provide a "focal point" for firms and their investors. We...

Persistent link: https://www.econbiz.de/10005489915

Firm Investment & Credit Constraints in India, 1997 – 2006: A stochastic frontier approach

Bhaumik, Sumon; Das, Pranab Kumar; Kumbhakar, Subal C. - William Davidson Institute, University of Michigan - 2011

We use the stochastic frontier approach to estimate the impact of firm characteristics on investment decisions of Indian firms during the 1997-2006 period. The use of the stochastic frontier approach allows us to define the (unobserved) optimum investment that is consistent with a firm's...

Persistent link: https://www.econbiz.de/10010575340

Investment, Efficiency, and Credit Rationing: Evidence from Hungarian Panel Data

Maurel, Mathilde - William Davidson Institute, University of Michigan - 2001

Relying upon a rich and unique panel of Hungarian firms over 7 years, from 1992 up to 1998, this paper estimates simultaneously TFP, Total Factor Productivity, identified as efficiency, and the parameters of a model where investment depends upon internal funds, wages, and sales, as in Prasnikar...

Persistent link: https://www.econbiz.de/10005651491

Corporate Governance and Market Valuation in China

Bai, Chong-En; Liu, Qiao; Lu, Joe; Song, Frank; Zhang, Junxi - William Davidson Institute, University of Michigan - 2003

This paper studies the relationship between the governance mechanisms and the market valuation of publicly listed firms in China empirically. We construct measures for corporate governance mechanisms and measures of market valuation for all publicly listed firms on the two stock markets in China...

Persistent link: https://www.econbiz.de/10005651502

Corporate Cash Holdings, National Culture, and Multinationality

Ramirez, Andres; Tadesse, Solomon - William Davidson Institute, University of Michigan - 2007

We examine the relations between national cultures, the multinationality of the firm and its holdings of cash. We develop several hypotheses from well known corporate finance theories and theories of the multinational firm, positing that cultural factors as well as the degree of multinationality...

Persistent link: https://www.econbiz.de/10005652504

Distance to the Efficiency Frontier and FDI Spillovers

Peter, Klara Sabirianova; Svejnar, Jan; Terrell, Katherine - William Davidson Institute, University of Michigan - 2004

We establish that domestically owned firms in two alternative models of emerging market economies, the Czech Republic and Russia, have not been converging to the technological frontier set by foreign owned firms. In both countries, the distance of domestic firms to the frontier grew (in all...

Persistent link: https://www.econbiz.de/10005652515

Financial Accelerator Effects in the Balance Sheets of Czech Firms

Horváth, Roman - William Davidson Institute, University of Michigan - 2006

The paper examines a financial accelerator mechanism in analyzing determinants of corporate interest rates. Using a panel of the financial statements of 448 Czech firms from 1996–2002, we find that balance sheet indicators matter for the interest rates paid by firms. Market access is...

Persistent link: https://www.econbiz.de/10005652517

Financial Development and Technology

Tadesse, Solomon - William Davidson Institute, University of Michigan - 2007

Research in development economics reveals that the bulk of cross-country differences in economic growth is attributable … to differences in productivity. By some accounts, productivity contributes to more than 60 percent of countries’ growth … progress, rates of real cost reduction and rates of productivity growth. I find that the effect of financial development on …

Persistent link: https://www.econbiz.de/10005652518

Ownership, Control and Corporate Performance After Large-Scale Privatization

Hanousek, Jan; Evžen Ko?enda; Svejnar, Jan - William Davidson Institute, University of Michigan - 2004

We analyze the effects of ownership type and concentration on performance of a population of firms in a model large-scale privatization economy (Czech Republic). Using specifications based on first-differences and unique instrumental variables, we find that few types of private ownership improve...

Persistent link: https://www.econbiz.de/10005652527

Governance and Performance of Microfinance Institutions in Central And Eastern Europe and the Newly Independent States

Hartarska, Valentina - William Davidson Institute, University of Michigan - 2004

This paper presents the first evidence on the impact of external governance mechanisms, board diversity and independence, and management compensation on outreach and sustainability of microfinance institutions in Central and Eastern Europe and the Newly Independent States. Results indicate that...

Persistent link: https://www.econbiz.de/10005652536