Download or read book Trade and Firm Financing written by Paul R. Bergin and published by . This book was released on 2019 with total page 55 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies how financial frictions pose a barrier to export entry by altering the firm's long-term capital structure, and thereby affecting the ability to finance sunk entry costs. Our focus on long-term firm financing stands in contrast with the emphasis in recent trade literature on the financing of short-term working capital as a barrier to export entry. We provide evidence that U.S. firms engaged in export tend to have leverage ratios higher than non-exporting firms in terms of long-term debt, but not in terms of short-term debt. To explain this fact and understand its implications, we marry a corporate finance model of capital structure, featuring an endogenous choice between equity and long-term debt financing, with a trade model featuring heterogeneous firms. The model of optimal capital structure indicates that in the long run, exporting firms will prioritize reducing the cost of long-term capital, used to pay sunk costs, over relaxing a short-term working capital constraint, which could be used to scale up production.

Download or read book Dynamic Models and Structural Estimation in Corporate Finance written by Ilya A. Strebulaev and published by Now Pub. This book was released on 2012-10-02 with total page 174 pages. Available in PDF, EPUB and Kindle. Book excerpt: The goals of this monograph are to explain the models and techniques and make it more accessible, introduce the main strands of this literature, and explain how dynamic models can be taken to the data and estimated, providing a guide to 3 methodologies: generalized method of moments, simulated method of moments, and maximum simulated likelihood.

Download or read book Essays on Capital Structure and Trade Financing written by Klaus Hammes and published by Department of Economics School of Economics and Commercial Law Go. This book was released on 2003 with total page 188 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Firm Financing in India written by Inessa Love and published by World Bank Publications. This book was released on 2005 with total page 67 pages. Available in PDF, EPUB and Kindle. Book excerpt: "Using balance sheet information for nearly 6,000 firms between 1994-2003, Love and Martinez Peria investigate recent firm financing patterns in India. They document the overall use of debt and, in particular, the role of bank financing (short-term and long-term), trade credit, intra-business group borrowing, and foreign financing. The authors examine financing patterns over time and explore differences across firms by sector, age, ownership type, export orientation, and, in particular, size. In terms of trends, they find that while debt to asset ratios have been relatively stable, nominal debt growth has slowed down in recent years. At the same time, firms' repayment capacity, as measured by the interest coverage ratio, has exhibited a U-shaped pattern falling during 1997-99 and recovering in recent years. Throughout the period of study, bank financing as a share of total debt has increased, while borrowing from nonbank financial institutions fell sharply. In terms of differences across firms, the most robust finding is that debt levels increase with firm size. Smaller firms have especially less debt relative to larger firms if they are young (below 10 years since incorporation), if they are in the manufacturing sector, and if they are located in Southern India. Furthermore, while the ratio of debt to assets has been relatively stable for large firms, the authors observe a significant decline for smaller firms. Overall, the findings presented provide suggestive (but not definite) evidence of stronger credit constraints for smaller firms. This paper--a product of the Finance Team, Development Research Group--is part of a larger effort in the department to study access to finance"--Abstract.

Download or read book Formal Finance and Trade Credit During China s Transition written by Robert J. Cull and published by World Bank Publications. This book was released on 2007 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using a large panel dataset of Chinese industrial firms, the authors examine the determinants of access to loans from formal financial intermediaries and extension of trade credit. Poorly performing state-owned enterprises were more likely to redistribute credit to firms with less privileged access to loans through trade credit, a pattern consistent with some of the extension of trade credit being involuntary. By contrast, profitable private domestic firms were more likely to extend trade credit than unprofitable ones. Trade credit likely provided a substitute for loans for these private firms' customers that were shut out of formal credit markets. As biases in lending became less severe, the amount of trade credit extended by private firms declined.

Download or read book Capital Structure and Corporate Financing Decisions written by H. Kent Baker and published by John Wiley & Sons. This book was released on 2011-03-31 with total page 506 pages. Available in PDF, EPUB and Kindle. Book excerpt: 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.

Download or read book Banking and Trading written by Mr.Arnoud W.A. Boot and published by International Monetary Fund. This book was released on 2012-10-02 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt: We study the effects of a bank's engagement in trading. Traditional banking is relationship-based: not scalable, long-term oriented, with high implicit capital, and low risk (thanks to the law of large numbers). Trading is transactions-based: scalable, shortterm, capital constrained, and with the ability to generate risk from concentrated positions. When a bank engages in trading, it can use its ‘spare’ capital to profitablity expand the scale of trading. However, there are two inefficiencies. A bank may allocate too much capital to trading ex-post, compromising the incentives to build relationships ex-ante. And a bank may use trading for risk-shifting. Financial development augments the scalability of trading, which initially benefits conglomeration, but beyond some point inefficiencies dominate. The deepending of the financial markets in recent decades leads trading in banks to become increasingly risky, so that problems in managing and regulating trading in banks will persist for the foreseeable future. The analysis has implications for capital regulation, subsidiarization, and scope and scale restrictions in banking.

Download or read book Firms as Financial Intermediaries written by Vojislav Maksimovic and published by . This book was released on 2016 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt: Trade credit can be an important complement to lending by financial intermediaries.Demirguc-Kunt and Maksimovic argue that nonfinancial firms act as intermediaries by channeling short-term funds from the financial institutions in an economy to their best use. Nonfinancial firms act in this way because they may have a comparative advantage in exploiting informal means of ensuring that borrowers repay.These considerations suggest that to optimally exploit their advantage in providing trade credit to some classes of borrowers, firms should obtain external financing from financial intermediaries and markets when this is efficient. Thus the existence of a large banking system is consistent with these considerations.Using firm-level data for 39 countries, the authors compute turnovers in payables and receivables and examine how they differ across financial systems. They find that the development level of a country's legal infrastructure and banking system predicts the use of trade credit. Firms' use of bank debt is higher relative to their use of trade credit in countries with efficient legal systems. But firms in countries with large, privately owned banking systems offer more financing to their customers and take more financing from them.The authors' findings suggest that trade credit is a complement to lending by financial intermediaries and should not be viewed by policymakers as a substitute.This paper - a product of Finance, Development Research Group - is part of a larger effort in the group to understand firm financing constraints. The authors may be contacted at [email protected] or [email protected].

Download or read book Financing Constraints Firm Dynamics and International Trade written by Stéphane Verani and published by . This book was released on 2012 with total page 47 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Global Production written by Pol Antràs and published by Princeton University Press. This book was released on 2020-10-13 with total page 336 pages. Available in PDF, EPUB and Kindle. Book excerpt: Global Production is the first book to provide a fully comprehensive overview of the complicated issues facing multinational companies and their global sourcing strategies. Few international trade transactions today are based on the exchange of finished goods; rather, the majority of transactions are dominated by sales of individual components and intermediary services. Many firms organize global production around offshoring parts, components, and services to producers in distant countries, and contracts are drawn up specific to the parties and distinct legal systems involved. Pol Antràs examines the contractual frictions that arise in the international system of production and how these frictions influence the world economy. Antràs discusses the inevitable complications that develop in contract negotiation and execution. He provides a unified framework that sheds light on the factors helping global firms determine production locations and other organizational choices. Antràs also implements a series of systematic empirical tests, based on recent data from the U.S. Customs and Census Offices, which demonstrate the relevance of contractual factors in global production decisions. Using an integrated approach, Global Production is an excellent resource for researchers, graduate students, and advanced undergraduates interested in the inner workings of international economics and trade.

Download or read book Fine trading and factoring Methods of company funding written by Florian Beyer and published by GRIN Verlag. This book was released on 2020-04-27 with total page 19 pages. Available in PDF, EPUB and Kindle. Book excerpt: Seminar paper from the year 2017 in the subject Business economics - Investment and Finance, grade: 1,0, The FOM University of Applied Sciences, Hamburg, language: English, abstract: A brief introduction of the Basel requirements is outlined. Following a definition and distinguishment of fine trading, factoring and reverse. Advantages and disadvantages are being explained as well. Finally, the influences on the balance sheet of the involved parties and on working capital are investigated. Ten years ago, from 2007 to 2011 the global financial and the euro crisis have caused a peak in bankruptcies of many companies and even states have experienced financial difficulties. Since 2011, the total number of companies’ bankruptcies declines. In 2016, there were 21,518 insolvencies of companies in Germany. In contrast to this, in 2010, at the peak of the crisis there were 32,687 insolvencies. Overall, most of the companies in Germany are small and medium-sized enterprises (SME). In 2014, they represented 99.3 percent of all companies in Germany. A proper working capital management is essential for all companies. Especially, SME are otherwise threatened to lack of liquidity or risk to become insolvent. Company funding has experienced profound changes lately. Basel I-III have extensively changed the regulatory circumstances for banks and their granting of credits. Banks must comply with changed regulatory capital and liquidity requirements as well as with new debt caps. This has a strong influence on company funding. Therefore, the rating of a firm and the risk of an investment will increase the price of the company funding. The changed importance of working capital management and the new regulatory requirements have altered companies’ financing possibilities and partners. Moreover, the financial crisis has revealed their dependency on certain bankrollers. Thus, other methods of financing suchlike factoring, fine trading, leasing and crowdfunding increased their importance. This paper examines fine trading and factoring regarding their differences, advantages, disadvantages and the methods’ influence on the balance sheet.

Download or read book Trade credit financial intermediary development and industry growth written by Raymond Fisman and published by World Bank Publications. This book was released on 2001 with total page 34 pages. Available in PDF, EPUB and Kindle. Book excerpt: Where do firms turn for financing in countries with poorly developed financial markets? One source is trade credit. And where formal financial intermediaries are deficient, industries that rely more on this source of financing grow faster.

Download or read book Trade Credit and the Effect of Macro Financial Shocks written by Mr.Yungsan Kim and published by International Monetary Fund. This book was released on 2003-06-01 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Many studies examine why firms are financed by their suppliers, but few empirical studies look at the macroeconomic implications of such financial arrangements. Using disaggregated panel data, we examine how firms extend and use trade credit. We find that, controlling for the transactions or asset management motive, both accounts payable and receivable increase with tighter policy, implying that trade credit helps firms absorb the effect of a credit contraction. A comparison of S&P 500 firms with smaller firms, however, provides no evidence that when policy is tightened, large firms play the role of credit suppliers more actively than small firms.

Download or read book Financing Constraints Firm Dynamics and International Trade written by Stephane Verani and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Introduction to Business written by Lawrence J. Gitman and published by . This book was released on 2024-09-16 with total page 1455 pages. Available in PDF, EPUB and Kindle. Book excerpt: Introduction to Business covers the scope and sequence of most introductory business courses. The book provides detailed explanations in the context of core themes such as customer satisfaction, ethics, entrepreneurship, global business, and managing change. Introduction to Business includes hundreds of current business examples from a range of industries and geographic locations, which feature a variety of individuals. The outcome is a balanced approach to the theory and application of business concepts, with attention to the knowledge and skills necessary for student success in this course and beyond. This is an adaptation of Introduction to Business by OpenStax. You can access the textbook as pdf for free at openstax.org. Minor editorial changes were made to ensure a better ebook reading experience. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution 4.0 International License.

Download or read book Finance and Economics Discussion Series written by Stephane Verani and published by . This book was released on 2015-02-16 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: This work has been selected by scholars as being culturally important, and is part of the knowledge base of civilization as we know it. This work was reproduced from the original artifact, and remains as true to the original work as possible. Therefore, you will see the original copyright references, library stamps (as most of these works have been housed in our most important libraries around the world), and other notations in the work. This work is in the public domain in the United States of America, and possibly other nations. Within the United States, you may freely copy and distribute this work, as no entity (individual or corporate) has a copyright on the body of the work.As a reproduction of a historical artifact, this work may contain missing or blurred pages, poor pictures, errant marks, etc. Scholars believe, and we concur, that this work is important enough to be preserved, reproduced, and made generally available to the public. We appreciate your support of the preservation process, and thank you for being an important part of keeping this knowledge alive and relevant.

Download or read book Financing International Trade in the Ninth Federal Reserve District written by Oscar F. Litterer and published by . This book was released on 1970 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: