nep-cfn New Economics Papers
on Corporate Finance
Issue of 2022‒10‒31
eight papers chosen by
Zelia Serrasqueiro
Universidade da Beira Interior

  1. An Elementary Model of VC Financing and Growth By Jeremy Greenwood; Pengfei Han; Hiroshi Inokuma; Juan M. Sanchez
  2. Did High Leverage Render Small Businesses Vulnerable to the COVID-19 Shock? By Falk Bräuning; José Fillat; J. Christina Wang
  3. Improving SME Access to Trade Credit and Financing in MENA By Arnaud Dornel; Meriem Ait Ali Slimane; Komal Mohindra
  4. Corporate Debt and Stock Returns : Evidence from U.S. Firms during the 2020 Oil Crash By Arezki,Rabah; Cho,Caleb Sungwoo; Ha Nguyen; Pham,Anh
  5. Private Credit in Emerging Markets By Meera Narayanaswamy; Fedor Miryugin
  6. Assessment of Long-term Finance Providers for Small and Medium Agribusinesses By World Bank Group
  7. The Determinants of Tax Incentive Effectiveness During Covid-19 Pandemic By Patricia Diana
  8. A general firm value model under partial information By Mbaye, Cheikh; Sagna, Abass; Vrins, Frédéric

  1. By: Jeremy Greenwood; Pengfei Han; Hiroshi Inokuma; Juan M. Sanchez
    Abstract: This article uses an endogenous growth model to study how the improvements in financing for innovative start-ups brought by venture capital (VC) affect firm innovation and growth. Partial equilibrium results show how lending contracts change as financing efficiency improves, while general equilibrium results demonstrate that better screening and development of projects by VC investors leads to higher aggregate productivity growth.
    Keywords: endogenous growth; financial development; innovation; IPO; screening; research and development; startups; venture capital
    JEL: E13 E22 G24 L26 O16 O31 O40
    Date: 2022–08–03
  2. By: Falk Bräuning; José Fillat; J. Christina Wang
    Abstract: Using supervisory data on small and mid-sized nonfinancial enterprises (SMEs), we find that those SMEs with higher leverage faced tighter constraints in accessing bank credit after the COVID-19 outbreak in spring 2020. Specifically, SMEs with higher pre-COVID leverage obtained a smaller volume of new loans and had to pay a higher spread on them during the pandemic period. Consistent with an inward shift in loan supply, these effects were concentrated in loans originated by banks with below-median capital buffers. Highly levered SMEs that relied on low-capital large banks for funding before the pandemic were not able to substitute to other sources of debt financing and thus experienced more of a reduction in total debt as well as a decline in investment and employment. On the other hand, the unprecedented public support, especially the Paycheck Protection Program (PPP), mitigated the adverse real effect stemming from bank credit constraints.
    Keywords: leverage; small business; credit supply; bank capital; COVID-19
    JEL: G21 G28 G32
    Date: 2022–07–01
  3. By: Arnaud Dornel; Meriem Ait Ali Slimane; Komal Mohindra
    Keywords: Finance and Financial Sector Development - Access to Finance Finance and Financial Sector Development - Microfinance International Economics and Trade - Trade Finance and Investment Private Sector Development - Small and Medium Size Enterprises
    Date: 2020–12
  4. By: Arezki,Rabah; Cho,Caleb Sungwoo; Ha Nguyen; Pham,Anh
    Abstract: This paper explores the effect of oil price fluctuations on the stock returns of U.S. oil firmsusing an identification strategy through heteroskedasticity, exploiting the 2020 oil price crash. The results aretwofold. First, a decline in oil prices significantly reduces oil firms’ stock returns. On average, a 1 percentdecline in oil prices leads to a 0.44 percent decline in stock prices. Second, firm debt appears irrelevant inmediating the effect of oil prices on oil firms’ stock returns. Moreover, the muted role of debt was not likelycaused by the liquidity backstop provided by the Federal Reserve.
    Date: 2022–06–13
  5. By: Meera Narayanaswamy; Fedor Miryugin
    Keywords: Finance and Financial Sector Development - Access to Finance Finance and Financial Sector Development - Capital Markets and Capital Flows Finance and Financial Sector Development - Finance and Development Finance and Financial Sector Development - Non Bank Financial Institutions Private Sector Development - Emerging Markets Private Sector Development - Private Sector Economics
    Date: 2021–01
  6. By: World Bank Group
    Keywords: Agriculture - Agribusiness Agriculture - Agricultural Sector Economics Finance and Financial Sector Development - Access to Finance Finance and Financial Sector Development - Rural Finance Private Sector Development - Small and Medium Size Enterprises
    Date: 2021
  7. By: Patricia Diana (Universitas Multimedia Nusantara, 15810, Tangerang, Indonesia Author-2-Name: Chermian Eforis Author-2-Workplace-Name: Universitas Multimedia Nusantara, 15810, Tangerang, Indonesia Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:)
    Abstract: " Objective - The paper aims to measure tax incentive effectiveness specifically for SMEs using internal government factors such as modernization and socialization of the tax system and internal personal taxpayers' factors using tax knowledge. Methodology/Technique - Using primary data collected by questionnaire. Respondent criteria prepare according to SMEs classification from the Regulation of the Minister of Finance of the Republic of Indonesia. Data in this study were analyzed using multiple linear regression with SPSS statistics. Findings - this research found that modernization, socialization, and taxpayer knowledge will improve tax incentive efficiency. Internal government factors consist of modernization of the tax system and frequent socialization, significantly encouraging taxpayers to utilize the incentive without having deep knowledge of taxation. Novelty - This study explains the determinants of tax incentives from both sides, government, and taxpayer, especially for SMEs during pandemic COVID 19 in the Indonesian market. Type of Paper - Empirical."
    Keywords: Tax Incentive, Fiscal Policy, Covid-19, Indonesia
    JEL: E62 E64 H25 D83
    Date: 2022–09–30
  8. By: Mbaye, Cheikh (Université catholique de Louvain, LIDAM/LFIN, Belgium); Sagna, Abass; Vrins, Frédéric (Université catholique de Louvain, LIDAM/LFIN, Belgium)
    Abstract: We introduce a new structural default model which purpose is to combine enhanced economic relevance and affordable computational complexity. Our approach exploits the information conveyed by a noisy observation of the firm value combined with the firm’s actual default state. Moreover, it is rather general since any diffusion can be used to depict the firm’s dynamics. However, this realistic setup comes at the expense of important computational challenges. To mitigate them, we propose an implementation based on recursive quantization. A thorough analysis of the approximation error resulting from our numerical procedure is provided. The power of our method is illustrated on the pricing of CDS options. This analysis reveals that the observation noise has a significant impact on the credit spreads’ implied volatility.
    Keywords: Finance ; credit risk ; structural model ; noisy information ; non-linear filtering
    Date: 2022–07–28

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