Journal of Finance
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Опубликовано на портале: 14-06-2006
Mihir A. Desai, C. Fritz Foley, James R. Hines
Journal of Finance.
2004.
Vol. 59.
No. 6.
P. 2451-2487.
This paper analyzes the capital structures of foreign affiliates and internal capital
markets of multinational corporations. Ten percent higher local tax rates are associated
with 2.8% higher debt/asset ratios, with internal borrowing being particularly sensitive
to taxes. Multinational affiliates are financed with less external debt in countries
with underdeveloped capital markets or weak creditor rights, reflecting significantly
higher local borrowing costs. Instrumental variable analysis indicates that greater
borrowing from parent companies substitutes for three-quarters of reduced external
borrowing induced by capital market conditions. Multinational firms appear to employ
internal capital markets opportunistically to overcome imperfections in external
capital markets.
Опубликовано на портале: 14-06-2006
J. R. Franks, J. J. Pringle
Journal of Finance.
1982.
Vol. 37.
No. 3.
P. 751-763.
In this paper we consider the role of financial intermediaries in the valuation of
firms and projects. We show that security prices should reflect both used and unused
debt capacity if some corporations can act as financial intermediaries and can capture
the tax benefits of debt capacity unused by the operating firm. We also provide some
reasons why the value of the firm might be increased if the financing and operating
risks of the firm are separated and financial intermediaries issue debt rather than
the unit operating the asset.
Опубликовано на портале: 05-06-2006
Murillo Campello
Journal of Finance.
2002.
Vol. 57.
No. 6.
P. 2773-2805.
This paper looks at internal capital markets in financial conglomerates by comparing
the responses of small subsidiary and independent banks to monetary policy. I find
that internal capital markets in financial conglomerates relax the credit constraints
faced by smaller bank affiliates. Further analysis indicates that those markets lessen
the impact of Fed policies on bank lending activity. The paper also examines the
role of internal capital markets in influencing the investment allocation process
of those conglomerates. My findings suggest that frictions between conglomerate headquarters
and external capital markets are at the root of investment inefficiencies generated
by internal capital markets.
Опубликовано на портале: 29-10-2008
Rafael La Porta, Florencio Lopez-de-Silanes, Andrei Shleifer, Robert W. Vishny
Journal of Finance.
2002.
Vol. 57.
No. 3.
P. 1147-1170.
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 539 large firms from 27 wealthy economies.
Consistent with the model, we find evidence of higher valuation of firms in countries
with better protection of minority shareholders and in firms with higher cash-flow
ownership by the controlling shareholder.
Опубликовано на портале: 05-06-2006
Adolfo De Motta
Journal of Finance.
2003.
Vol. 58.
No. 3.
P. 1193-1220.
Capital budgeting in multidivisional firms depends on the external assessment of
the whole firm, as well as on headquarters' assessment of the divisions. While corporate
headquarters may create value by directly monitoring divisions, the external assessment
of the firm is a public good for division managers who, consequently, are tempted
to free ride. As the number of divisions increases, the free-rider problem is aggravated,
and internal capital markets substitute for external capital markets in the provision
of managerial incentives. The analysis relates the value of diversification to characteristics
of the firm, the industry, and the capital market.
Опубликовано на портале: 05-06-2006
Naveen Khanna, Sheri Tice
Journal of Finance.
2001.
Vol. 56.
No. 4.
We examine capital expenditure decisions of discount firms in response to Wal-Mart's
entry into their markets. Before Wal-Mart's entry, focused incumbents and discount
divisions of diversified incumbents are similar in size, geographic dispersion, and
firm debt levels. However, discount divisions of diversified firms are significantly
more productive. After Wal-Mart's entry, diversified firms are quicker to either
“exit” the discount business or “stay and fight.” Also, their
capital expenditures are more sensitive to the productivity of their discount business.
Internal capital markets function well, as transfers are away from the worsening
discount divisions. It appears diversified firms make better investment decisions.
The Dark Side of Internal Capital Markets: Divisional Rent-Seeking and Inefficient
Investment. [статья]
Опубликовано на портале: 05-06-2006
David S. Scharfstein, Jeremy C. Stein
Journal of Finance.
2000.
Vol. 55.
No. 6.
P. 2537-2565.
We develop a two-tiered agency model that shows how rent-seeking behavior on the
part of division managers can subvert the workings of an internal capital market.
By rent-seeking, division managers can raise their bargaining power and extract greater
overall compensation from the CEO. And because the CEO is herself an agent of outside
investors, this extra compensation may take the form not of cash wages, but rather
of preferential capital budgeting allocations. One interesting feature of our model
is that it implies a kind of "socialism" in internal capital allocation, whereby
weaker divisions get subsidized by stronger ones.
Опубликовано на портале: 16-04-2007
Art Durnev, E.Han Kim
Journal of Finance.
2005.
Vol. LX.
No. 3.
P. 1461-1493.
Data on corporate governance and disclosure practices reveal wide within-country
variation that decreases with the strength of investors' legal protection. A simple
model identifies three firm attributes related to that variation: investment opportunities,
external financing, and ownership structure. Using firm-level governance and transparency
data in 27 countries, we find that all three firm attributes are related to the quality
of governance and disclosure practices and that firms with higher governance and
transparency rankings are valued higher in stock markets. All relations are stronger
in less investor-friendly countries, demonstrating that firms adapt to poor legal
environments to establish efficient governance practices.
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