Access to Liquidity and Corporate Investment in Europe during the Financial Crisis*

Campello, Murillo; Giambona, Erasmo; Graham, John R.; Harvey, Campbell R.

doi:10.1093/rof/rfr030

Cited by 138 publications

(76 citation statements)

References 31 publications

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“…r = r + 1.5%, in a sample of 11,578 credit lines obtained by 4,011 public firms between 1996 and 2003. (Campello et al, 2012, report similar numbers in a recent survey of 800 CFOs from North America, Europe, and Asia.) For this value of the pre-committed interest rate, we have to raise the corporate tax rate to τ = 30% for the firm to use credit lines at all.…”

Section: E1(x;c * )supporting

confidence: 53%

Financing Investment: The Choice Between Bonds and Bank Loans

Morellec

Valta

Zhdanov³

2015

Management Science

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We build a model of investment and financing decisions to study the choice between bonds and bank loans in a firm's marginal financing decision and its effects on corporate investment. We show that firms with more growth options, higher bargaining power in default, operating in more competitive product markets, and facing lower credit supply are more likely to issue bonds. We also demonstrate that, by changing the cost of financing, these characteristics affect the timing of investment. We test these predictions using a sample of U.S. firms and present new evidence that supports our theory.

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Section: E1(x;c * )supporting

confidence: 53%

Financing Investment: The Choice Between Bonds and Bank Loans

Morellec

Valta

Zhdanov³

2015

Management Science

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“…This is because the valuable cash tied up through working capital cycle contributes to business failures and played a critical role in firm performance during the financial crisis (Campello et al, 2011(Campello et al, , 2012Campello et al, 2010;Claessens et al, 2000;Pomerleano, 1998). It is then obvious to firms that their liquidity problems can only be solved through effective liquidity and cash management, since an effective way to lessen the reliance on external funding and counter-market difficulties is to continue to track and optimize internal resources (Rydel, 2012).…”

Section: Introductionmentioning

confidence: 99%

Working Capital Management and Firm Value: The Role of Firm Innovativeness

Nurein

Din

2017

Book of Abstracts International Conference on Economics and Development

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Abstract:There have been variations in working capital performance among firms and industries in various countries over the last decade. One of the causes of the variations is level of firm innovativeness. This study aims to examine the moderating role of firm innovativeness on the effect of working capital management on firm value between innovative and non-innovative firms in an emerging market. The study was carried out based on 400 listed firms in Bursa Malaysia for the period 2006-2015. By using a fixed regression estimation, the findings indicate that innovative firms have a better working capital performance than the non-innovative firms since they apply their innovative capabilities towards improving their working capital performance. This study suggests that firms need to align their innovative capabilities towards working capital management to improve firm value.

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“…Campello, E. Giambona, J. R. Graham and C. R. Harvey (2012) [8] reported that "the recent crisis did not severely hinder firms' ability to access lines of credit and draw down existing facilities". This proved to be of utmost importance for European companies as credit lines from banking sector became an essential way of financing and eased the financial crisis effect on investment and firm's financial performance, (as is shown Table 2).…”

Section: The Effect Of European Crisis On Investment Managementmentioning

confidence: 99%

“…Campello, Giambona, Graham, and Harvey (2012) [8] • examine how firms in Europe used credit lines during the financial crisis.…”

Section: The Effect Of European Crisis On Investment Managementmentioning

confidence: 99%

The Effect of IFRS Adoption on Investment Management: A Review of the Literature

Kapellas¹,

Siougle²

2018

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Recent literature contains a number of studies that provide evidence that improvements in the performance related to business investments are associated with the main positive results of the implementation of international financial reporting standards (hear after IFRS). This study is an effort trying to summarize empirical evidences in current literature about the effect of the IFRS adoption on investment management. We summarize literature on the effect of IFRS a) in a European setting b) in a worldwide setting. We especially refer to the effect of European Crisis on Investment Management. We summarize evidence on the impact of IFRS adoption worldwide on investments assets, foreign direct investments (FDIs), cross boarder investments (Merger and Acquisition activities) and foreign mutual fund ownership. We finally present some evidence on the impact of IFRS adoption on US home bias and try to document the impact of IFRS adoption on international listing and IPOS in global markets.

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Access to Liquidity and Corporate Investment in Europe during the Financial Crisis*

Cited by 138 publications

References 31 publications

Financing Investment: The Choice Between Bonds and Bank Loans

Financing Investment: The Choice Between Bonds and Bank Loans

Working Capital Management and Firm Value: The Role of Firm Innovativeness

The Effect of IFRS Adoption on Investment Management: A Review of the Literature

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