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Author: Aslı Demirgüç-Kunt
Publisher: World Bank Publications
ISBN:
Category : Banks and banking
Languages : en
Pages : 48
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Book Description
Author: Najeb Masoud
Publisher:
ISBN:
Category :
Languages : en
Pages : 27
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Book Description
This study attempts to extend knowledge of the role of financial market development in the financing choice of firms in developing countries using cross-sectional regression estimator with a dynamic-panel approach for 219 firms listed on the three emerging countries during the period 1990-2012. Capital structure studies have generally been aimed at studying the determinants of optimal leverage. Empirically, the focus is, however, on studying the association between observed leverage and a set of explanatory variables. Various theories, namely, the trade-off, pecking order and agency theories, are deployed to explain and predict the signs and significance of each factor identified by Ragan and Zingales (1995) and Booth et al. (2001). The pioneering work of Modigliani and Millar, and many scholars revealed that the financial leverage is one of the most influencing factors in determining the firm growth. The results suggest that liquidity and profitability are negatively and significantly related to the leverage ratios, while the firm size is positively and significantly related to leverage. Leverage is negatively related with tangibility in two emerging countries. Therefore, growth opportunities are positively related to book value leverage and negatively related to market leverage in all three emerging countries. However, our results generally indicate that both the trade-off and the pecking order theories can explain three emerging firms' financing decisions. These results indicate that high price-earnings ratios and high interest rates will cause firms to choose equity over debt, as both of these factors reduce the cost of equity finance. Furthermore, the results suggest an unimportant role for economic growth and inflation rates in explaining the variation in debt-equity ratios. Results show that further development in the stock market indicators are negatively and significantly related to the leverage ratios in emerging countries (Jordan, Kuwait and Malaysia) suggesting that as equity markets in these countries become more developed and their liquidity improves, while banking sector development favours debt financing over equity financing, as one would expect.
Author: Aslı Demirgüç-Kunt
Publisher: World Bank Publications
ISBN:
Category : Banks and banking
Languages : en
Pages : 48
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Book Description
Author: H. Kent Baker
Publisher: John Wiley & Sons
ISBN: 0470569522
Category : Business & Economics
Languages : en
Pages : 516
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Book Description
A comprehensive guide to making better capital structure and corporate financing decisions in today's dynamic business environment Given the dramatic changes that have recently occurred in the economy, the topic of capital structure and corporate financing decisions is critically important. The fact is that firms need to constantly revisit their portfolio of debt, equity, and hybrid securities to finance assets, operations, and future growth. Capital Structure and Corporate Financing Decisions provides an in-depth examination of critical capital structure topics, including discussions of basic capital structure components, key theories and practices, and practical application in an increasingly complex corporate world. Throughout, the book emphasizes how a sound capital structure simultaneously minimizes the firm's cost of capital and maximizes the value to shareholders. Offers a strategic focus that allows you to understand how financing decisions relates to a firm's overall corporate policy Consists of contributed chapters from both academics and experienced professionals, offering a variety of perspectives and a rich interplay of ideas Contains information from survey research describing actual financial practices of firms This valuable resource takes a practical approach to capital structure by discussing why various theories make sense and how firms use them to solve problems and create wealth. In the wake of the recent financial crisis, the insights found here are essential to excelling in today's volatile business environment.
Author: Mr.Omotunde E. G. Johnson
Publisher: International Monetary Fund
ISBN: 1451939167
Category : Business & Economics
Languages : en
Pages : 31
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Book Description
Firms in developing countries that seek outside financing for investment must often choose their debt-equity combinations in the face of financial market constraints on debt service, on outside equity financing, and on internal finance (endowments). Inefficiencies in the allocation of available finance and in the equity-debt choices that can ensue can be prevented by appropriate policy measures to improve information on profitable investment opportunities and about firms; to directly strengthen financial intermediation; and to support appropriate credit guarantee schemes.
Author: Iván Blanco
Publisher: Ed. Universidad de Cantabria
ISBN: 8481028770
Category : Business & Economics
Languages : en
Pages : 90
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Book Description
Do financial derivatives enhance or impede innovation? We aim to answer this question by examining the relationship between equity options markets and standard measures of firm innovation. Our baseline results show that firms with more options trading activity generate more patents and patent citations per dollar of R&D invested. We then investigate how more active options markets affect firms' innovation strategy. Our results suggest that firms with greater trading activity pursue a more creative, diverse and risky innovation strategy. We discuss potential underlying mechanisms and show that options appear to mitigate managerial career concerns that would induce managers to take actions that boost short-term performance measures. Finally, using several econometric specifications that try to account for the potential endogeneity of options trading, we argue that the positive effect of options trading on firm innovation is causal.
Author: Hendrik S. Houthakker
Publisher: Oxford University Press, USA
ISBN: 019504407X
Category : Business & Economics
Languages : en
Pages : 376
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Book Description
Providing a comprehensive introduction to the subject of financial markets, this study includes unique analyses of the pricing of options and futures, particularly futures in Eurodollars. The authors assume a basic understanding of economics.
Author: Ronald W. Masulis
Publisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 168
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Book Description
Author: Michael Joseph Dempsey
Publisher: World Scientific
ISBN: 1783267011
Category : Business & Economics
Languages : en
Pages : 332
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Book Description
Stock Markets, Investments and Corporate Behavior examines the nature of stock market growth and decline, the function of financial markets, and their implications for commercial companies. Traditionally, finance academics have attempted to understand financial markets and commercial companies as physicists approach their subject matter: with a set of laws in mind that govern the field. But finance is not physics. The academic's approach falsely assumes that financial markets can be understood as systems within which self-interested maximizers behave in logical ways that are coordinated by the invisible hand of the price mechanism. This book demonstrates that finance is more appropriately understood as a field in which investors and finance managers may or may not use rational calculations as the basis of their decision making.This book opens with an effective dismantling of the traditional mathematical approach used to understand and describe markets and corporate financial behavior. In its place, the mathematics of growth and decline is developed anew, while holding to the realization that the decisions of organizations rely on the choices of real people with limited information available to them. The book will appeal to all students who wish to reappraise their knowledge of finance in a thoughtful manner. Specifically, this book is designed to appeal to anyone who wishes to refine their understanding of the nature of stock markets and financial growth, optimal portfolio allocation, option pricing, asset valuation, corporate financial behavior, and what it means to be ethical in our financial institutions.
Author: Sergio L. Schmukler
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 32
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Book Description
This paper studies the relation between firm's financing choices and financial globalization. Using an East Asian and Latin American firm-level panel for the 1980s and 1990s, we study how leverage ratios, debt maturity structure, and sources of financing change when economies are liberalized and when firms access capital markets. We find that debt-equity rations do not increase after financial liberalization. However, domestic firms that actually participate in international capital markets extend their debt maturity. Financial liberalization has less effects on firms from countries with more developed domestic financial systems. Leverage ratios increase during crises
Author: H. Kent Baker
Publisher: John Wiley & Sons
ISBN: 0470499117
Category : Business & Economics
Languages : en
Pages : 773
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Book Description
A definitive guide to the growing field of behavioral finance This reliable resource provides a comprehensive view of behavioral finance and its psychological foundations, as well as its applications to finance. Comprising contributed chapters written by distinguished authors from some of the most influential firms and universities in the world, Behavioral Finance provides a synthesis of the most essential elements of this discipline, including psychological concepts and behavioral biases, the behavioral aspects of asset pricing, asset allocation, and market prices, as well as investor behavior, corporate managerial behavior, and social influences. Uses a structured approach to put behavioral finance in perspective Relies on recent research findings to provide guidance through the maze of theories and concepts Discusses the impact of sub-optimal financial decisions on the efficiency of capital markets, personal wealth, and the performance of corporations Behavioral finance has quickly become part of mainstream finance. If you need to gain a better understanding of this topic, look no further than this book.
