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Complex Ownership Structures and Corporate Valuations
Laeven, Luc - 2010
The bulk of corporate governance theory examines the agency problems that arise from two extreme ownership structures: 100 percent small shareholders or one large, controlling owner combined with small shareholders. In this paper, we question the empirical validity of this dichotomy. In fact,...
Persistent link: https://www.econbiz.de/10012760554
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Agency Costs, Mispricing, and Ownership Structure
Chernenko, Sergey - 2010
Standard theories of corporate ownership assume that because markets are efficient, insiders ultimately bear agency costs and therefore have a strong incentive to minimize conflicts of interest with outside investors. We show that if equity is overvalued, however, mispricing offsets agency costs...
Persistent link: https://www.econbiz.de/10013144749
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Does the Market Value R&D Investment by European Firms? Evidence from a Panel of Manufacturing Firms in France, Germany, and Italy
Hall, Bronwyn H.; Oriani, Raffaele - 2022
Several studies based on US and UK data have used market value as an indicator of the firm''s expected R&D performance. However, there exist no investigations for the continental countries in the European Union, partly because the analysis is complicated by data availability problems. In this...
Persistent link: https://www.econbiz.de/10013311906
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Governance and Bank Valuation
Caprio, Gerard - 2003
Which public policies and ownership structures enhance the governance of banks? This paper constructs a new database on the ownership of banks internationally and then assesses the ramifications of ownership, shareholder protection laws, and supervisory/regulatory policies on bank valuations....
Persistent link: https://www.econbiz.de/10012786320
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Cash Holdings and Credit Risk
Acharya, Viral V. - 2011
liquidity may be related positively to the longer-term probability of default. Our empirical analysis confirms these predictions …
Persistent link: https://www.econbiz.de/10013125920
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Fundamentals, Market Timing, and Seasoned Equity Offerings
DeAngelo, Harry - 2007
Firms conduct SEOs to resolve a near-term liquidity squeeze, and not primarily to exploit market timing opportunities …
Persistent link: https://www.econbiz.de/10012776447
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Pledgeability, Industry Liquidity, and Financing Cycles
Diamond, Douglas W. - 2017
industry liquidity. The market allows firms take on more debt when they anticipate higher future liquidity. However, both high … anticipated liquidity and the resulting high debt limit their incentives to enhance pledgeability. This has prolonged adverse … effects in a downturn. Because these effects are hard to contract upon, higher anticipated liquidity can also reduce a firm …
Persistent link: https://www.econbiz.de/10012965425
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Agency Problems and the Fate of Capitalism
Morck, Randall - 2010
Economics has firms maximizing value and people maximizing utility, but firms are run by people. Agency theory concerns the mitigation of this internal contradiction in capitalism. Firms need charters, regulations and laws to restrain those entrusted with their governance, just as economies need...
Persistent link: https://www.econbiz.de/10013136737
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Governance and Stakeholders
Mehrotra, Vikas - 2017
Economic models routinely assume firms maximize shareholder wealth; however common law legal systems only require that officers and directors pursue the interests of the corporation, leaving this ill-defined. Economic arguments for shareholder wealth maximization derived from shareholders'...
Persistent link: https://www.econbiz.de/10012954931
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Investor Protection and Corporate Valuation
La Porta, Rafael; Lopez de Silanes, Florencio; … - 2021
We present a model of the effects of legal protection of minority shareholders and of cash flow ownership by a controlling shareholder on the valuation of firms. We then test this model using a sample of 371 large firms from 27 wealthy economies. Consistent with the model, we find evidence of...
Persistent link: https://www.econbiz.de/10013237249