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Why Do Companies Go Public? An Empirical Analysis

Pagano, Marco - 1995

finance subsequent investment and growth, but to reduce leverage, (iv) going public reduces the cost of bank credit; (v) it is …

Persistent link: https://www.econbiz.de/10012473502

Do Financing Constraints Explain Why Investment is Correlated with Cash Flow?

Kaplan, Steven N. - 1995

This paper investigates the sources of the correlation between corporate cash flow and investment by undertaking an in-depth analysis of the 49 low-dividend firms identified by Fazzari, Hubbard, and Petersen (1988) as having an unusually high investment-cash flow sensitivity. We find that in...

Persistent link: https://www.econbiz.de/10012473608

Kill Zone

Kamepalli, Sai Krishna - 2020

We study why high-priced acquisitions of entrants by an incumbent do not necessarily stimulate more innovation and entry in an industry (like that of digital platforms) where customers face switching costs and enjoy network externalities. The prospect of an acquisition by the incumbent platform...

Persistent link: https://www.econbiz.de/10012481729

Monnet's Error?

Guiso, Luigi - 2015

-Europe sentiment as does the 2010 Eurozone crisis. Yet, in spite of the worst recession in recent history, the Europeans still support …

Persistent link: https://www.econbiz.de/10012457545

The Role of Social Capital in Financial Development

Guiso, Luigi - 2000

To identify the effect of social capital on financial development, we exploit the well-known differences in social capital and trust (Banfield (1958), Putnam (1993)) across different parts of Italy, using microeconomic data on households and firms. In areas of the country with high levels of...

Persistent link: https://www.econbiz.de/10012471212

Trusting the Stock Market

Guiso, Luigi - 2005

We provide a new explanation to the limited stock market participation puzzle. In deciding whether to buy stocks, investors factor in the risk of being cheated. The perception of this risk is a function not only of the objective characteristics of the stock, but also of the subjective...

Persistent link: https://www.econbiz.de/10012467028

The Cost of Diversity : The Diversification Discount and Inefficient Investment

Rajan, Raghuram - 1998

In a simple model of capital budgeting in a diversified firm where headquarters has limited power, we show that funds are allocated towards the most inefficient divisions. The distortion is greater the more diverse are the investment opportunities of the firm's divisions. We test these...

Persistent link: https://www.econbiz.de/10012472450

Survival of the Fittest or the Fattest? Exit and Financing in the Trucking Industry

Zingales, Luigi - 1997

This paper studies the impact that capital market imperfections have on the natural" selection of the most efficient firms by estimating the effect of the pre-deregulation level of" leverage on the survival of trucking firms after the Carter deregulation. Highly leveraged" carriers are less...

Persistent link: https://www.econbiz.de/10012472539

The Cost of Banking Regulation

Guiso, Luigi - 2006

We use exogenous variation in the degree of restrictions to bank competition across Italian provinces to study both the … effects of bank regulation and the impact of deregulation. We find that where entry was more restricted the cost of credit was … increase in bad loans. In provinces where restrictions to bank competition were most severe, the proportion of bad loans after …

Persistent link: https://www.econbiz.de/10012466164

Banks and Markets : The Changing Character of European Finance

Zingales, Luigi - 2003

In the last two decades the European financial markets have become more market oriented. We analyze the economic and political forces that have triggered these changes as well as their likely welfare implications. We also try to assess whether this trend will continue. Based on our analysis, we...

Persistent link: https://www.econbiz.de/10012469104