|
on Corporate Finance |
| By: | Robert Petrunia (Lakehead University) |
| Abstract: | This presentation extends the literature on firm dynamics by incorporating ownership networks and financing in the study of firm growth. I observe co-ownership connections for the universe of privately owned Ecuadorian manufacturing firms between 2000 and 2019. The structure of my data allows to construct ownership network variables and determine their impact on firm growth in a quantile fixed-effect dynamic regression framework. This approach uncovers the heterogeneous impact of firm age on firm growth across the entire conditional firm-growth distributions and statistically significant leverage and network effects. The relationship between firm growth and leverage remains positive with the inclusion of ownership networks. For young firms, the results indicate that there is no significant relationship between age and growth. This result suggests that financial variables continue to matter and that ownership networks capture alternative aspects of firm dynamics that have not been previously acknowledged. |
| Date: | 2025–10–05 |
| URL: | https://d.repec.org/n?u=RePEc:boc:cand25:02 |
| By: | Kampmann, David |
| Abstract: | In many US Tech corporations such as Meta, Alphabet, and SpaceX, founders still hold shareholder voting control. How can we better understand the concentration of insider control in Tech? Drawing on quantitative and qualitative data to examine the rise of US start-up investments post-dotcom, this article demonstrates that a small group of new venture capital (VC) entrants played a key role in advancing founder control in Tech to win deals against established VC firms and make outsized capital gains. I argue that the VC market follows a winners-take-all logic, which facilitated the uptake of founder control in Tech via dual-class shares because of the success of new VC entrants and early founder-controlled tech firms exiting between 2010 and 2014, and the growing investments by nontraditional, “passive” investors post-2010. This matters because the winners-take-all logic reinforces capital concentration among leading VCs while many Tech monopolies are now controlled by a small tech elite fraction. |
| Keywords: | saving and capital investment; ratings and ratings agencies; technology; ideology; G24 investment banking; O16 financial markets; USA; corporate finance and governance; brokerage; competition; venture capital; political economy and comparative economic systems; corporate governance |
| JEL: | J1 F3 G3 |
| Date: | 2025–10–15 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:129826 |
| By: | Krystian Bua; Giovanni Dosi; Maria Enrica Virgillito |
| Abstract: | This paper presents new compelling evidence on the company-level ownership structure of military firms detained by asset managers. Employing a unique firm-level interlinked dataset, connecting publicly listed firms in the aerospace and defense industry, and their corresponding structure of ownership, we give account of the tremendous increase of (i) the market capitalization of the industry, which represents the one achieving the highest variation during the period 2021-2025; (ii) the increasing penetration of asset managers, particularly of the so-called Big Four, in the ownership structure of the military complex. Notably, we find evidence of common ownership dynamics driven by asset managers' holdings in both the aerospace and defense sectors, as well as a temporal co-movement between alternative proxies for corporate performance and the ownership shares held by portfolio managers in the military industry. Our evidence supports the progressive shift of financial capitalism, largely US-based, toward opportunity of profitability in global conflicts, via their ownership of leading international military firms. |
| Keywords: | Financialization, Monopoly capitalism, Financial imperialism |
| Date: | 2025–10–17 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/33 |
| By: | Florian Englmaier (LMU Munich); Jose E. Galdon-Sanchez (Universidad Publica de Navarra); Ricard Gil (IESE Business School); Michael Kaiser (E.CA Economics); Helene Strandt (LMU Munich) |
| Abstract: | This paper empirically examines how management practices affect firm productivity over the business cycle. Using plant-level high-dimensional human resource policies survey data collected in Spain in 2006, we employ unsupervised machine learning to describe clusters of management practices (“management styles”). We establish a positive correlation between a management style associated with structured management and performance prior to the 2008 financial crisis. Interestingly, this correlation turns negative during the financial crisis and positive again in the economic recovery post-2013. Our evidence suggests firms with more structured management are more likely to have practices fostering culture and intangible investments such that they focus in long-run profitability, prioritizing innovation over cost reduction, while having higher adjustment costs in the short-run through higher share of fixed assets and lower employee turnover. |
| Keywords: | management practices; culture; unsupervised machine learning; productivity; great recession; |
| JEL: | M12 D22 C38 |
| Date: | 2025–10–15 |
| URL: | https://d.repec.org/n?u=RePEc:rco:dpaper:548 |
| By: | Forkuo, Gabriel Osei; Emmanuel, Osei-Dwomoh; Nkuah, Joseph Kofi |
| Abstract: | This study explored the critical relationship between corporate governance practices and the incidence of bank failures in Ghana, a key issue for the nation's financial stability and economic resilience. While Ghana's banking sector has undergone significant modernization, recent high-profile bank failures have cast doubt on the effectiveness of existing governance and regulatory frameworks. This research quantitatively investigates how core governance factors—specifically board composition, risk management, and regulatory compliance—influence bank stability. Analyzing data from 30 banks, the study employs descriptive, correlation, and regression analyses to assess governance practices and their linkage to financial distress indicators. The findings reveal a significant relationship between board independence, robust risk management, regulatory compliance, and a reduced likelihood of bank failure. Notably, a higher proportion of independent directors and stronger adherence to regulatory and corporate governance codes are associated with lower non-performing loan ratios and fewer regulatory interventions. These results highlight persistent gaps in governance that contribute to financial distress and underscore the necessity of strengthening Ghana's banking oversight. The study provides valuable, evidence-based insights for policymakers, regulators, and banking institutions on enhancing governance frameworks to prevent future crises and foster a more resilient financial sector. |
| Keywords: | Corporate Governance, Bank Failures, Financial Stability, Board Composition, Regulatory Compliance, Risk Management, Ghana |
| JEL: | E3 E31 E32 E52 E58 E6 E61 E63 E66 G2 G20 G21 G22 G23 G24 G28 H5 |
| Date: | 2025–10–03 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126358 |
| By: | Alejandro Casado (BANCO DE ESPAÑA); David Martínez-Miera (UC3M AND CEPR) |
| Abstract: | We document the geographical and sectoral specialization of banks’ lending activities using comprehensive data on the universe of loans to corporate borrowers in Spain. Our analysis highlights how specific sources of specialization are more relevant for evaluating different types of borrowers. Specifically, loans to micro- and small firms exhibit reduced probabilities of default in local markets where banks specialize, whereas loans to medium-sized and large firms experience lower probabilities of default in sectors in which banks specialize. Crucially, we provide the first evidence of a direct link between bank specialization and better quality private information held by banks, by leveraging confidential data on banks’ private risk assessments reported to regulators. We corroborate and benchmark our findings by comparing them to those obtained analyzing relationship lending, a well-established proxy for firm-specific private information. |
| Keywords: | bank lending, bank specialization, financial stability, probability of default, private information |
| JEL: | D82 E58 G21 G32 L10 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:bde:wpaper:2539 |
| By: | Fioretti, Michele; Saint-Jean, Victor; Smith, Simon C. |
| Abstract: | Does shareholder visibility affect firms' prosocial behavior? What implications for other shareholders? Exploiting quasi-experimental variation from media coverage around Annual General Meetings and major crises (COVID-19 pandemic and Russian invasion of Ukraine), we show that prominent shareholders support costly prosocial initiatives when these yield reputational benefits. In contrast, less-visible financial blockholders oppose such expenditures at their portfolio firms and prefer to act themselves. Prosocial actions driven by reputational motives reduce investment, productivity, and profits by 1 - 3%, imposing costs on other shareholders. Our findings reveal new implications for minority investors of unobservable intra-shareholder conflicts that emerge when examining shareholder incentives. |
| Keywords: | shareholder value, wealth, conflict, warm glow, reputation, exit and voice, social responsibility, charitable donations, covid, Ukraine, Russia |
| JEL: | G32 G41 M14 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:cbscwp:329627 |
| By: | Tefera, Girum Abebe; Cassidy, Rachel; Weis, Toni Johannes |
| Abstract: | This paper presents a systematic review of the literature that evaluates the causal impact of interventions designed to enhance women's access to productive capital in low- and middle- income economies. The review identifies 27 studies that meet certain criteria, with wide geographic coverage. Overall, the evidence suggests that grants can spur entrepreneurship, but that such effects are mostly short-lived and not experienced by women operating subsistence businesses. For individual-liability loans, the evidence shows some positive impacts --- but only when credit products are designed to overcome flexibility needs and collateral constraints, and again often only for existing women entrepreneurs with higher baseline profits. The review also identifies an emerging research frontier, focused on the use of alternative data for credit scoring and the development of novel credit products facilitated by these data sources. |
| Date: | 2025–10–17 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:11232 |