Investment risk, CDS insurance, and firm financing
نویسندگان
چکیده
منابع مشابه
Corporate Financing and Investment: The Firm-Level Credit Multiplier∗
We study the effect of asset liquidity (“tangibility”) on firm policies in the presence of financing constraints. We do so in a real options framework that allows for the simultaneous determination of investment and financing. In the presence of financing imperfections, firms that operate more tangible assets have larger credit capacity. By expanding the firm’s capital base, the investment proc...
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We examine the effect of aggregate measures of CEO and consumer confidence on firm financing and investment. We find that capital expenditure, merger activity, and financing activity all increase with CEO and consumer confidence. However, while CEO confidence positively predicts future sales growth and return on assets, consumer confidence is negatively related to these performance measures as ...
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A recent literature has criticised the sensitivity of a firm’s investment to its own cash flow as an adequate measure of financing constraints. In this paper we develop a new method to detect the presence of financing constraints at firm level. We consider a structural dynamic model of investment with financing imperfections and with both fixed and variable capital. We solve the model and simul...
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We examine investment behavior when firms face costs in the access to external funds. We find that despite the existence of liquidity constraints, standard investment regressions predict that cash flow is an important determinant of investment only if one ignores q. Conversely, we also obtain significant cash flow effects even in the absence of financial frictions. These findings provide suppor...
متن کاملFinancing Insurance∗
Insurance has an intertemporal aspect as insurance premia have to be paid upfront. We argue that the financing aspect of insurance is key to understanding basic insurance patterns. In a model with limited enforcement, we show that insurance is globally monotone increasing in household net worth and income, incomplete, and precautionary. These results hold in economies with income risk, durable ...
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ژورنال
عنوان ژورنال: European Economic Review
سال: 2020
ISSN: 0014-2921
DOI: 10.1016/j.euroecorev.2020.103424