Ghatak, Maitreesh; Kali, Raja - University <Chicago, Ill.> / Department of Economics; … - 2001
Financial interlinkage, in the form of cross-holding of equity and debtbetween firms, characterizes business groups in many countries. We suggestthat such financial interlinkage can be viewed as a way to solve creditrationing caused by asymmetric information. If firms possess better...