Arbeitspapier

Business Groups in Emerging Markets - Financial Control and Sequential Investment

Business groups in emerging markets perform better than unaffiliated firms. One explanation is that business groups substitute some functions of missing institutions, for example, enforcing contracts. We investigate this by setting up a model where firms within the business group are connected to each other by a vertical production structure and an internal capital market. Thus, the business group's organizational mode and the financial structure allow a self-enforcing contract to be designed. Our model of a business group shows that only sequential investments can solve the ex post moral hazard problem. We also find that firms may prefer not to integrate.

Sprache
Englisch

Erschienen in
Series: SFB/TR 15 Discussion Paper ; No. 124

Klassifikation
Wirtschaft
Capital Budgeting; Fixed Investment and Inventory Studies; Capacity
Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
Legal Procedure, the Legal System, and Illegal Behavior: Other
Firm Organization and Market Structure
Thema
Business groups
self-enforcing contract
institutions
internal capital market

Ereignis
Geistige Schöpfung
(wer)
Hainz, Christa
Ereignis
Veröffentlichung
(wer)
Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)
(wo)
München
(wann)
2006

DOI
doi:10.5282/ubm/epub.13427
Handle
URN
urn:nbn:de:bvb:19-epub-13427-1
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Hainz, Christa
  • Sonderforschungsbereich/Transregio 15 - Governance and the Efficiency of Economic Systems (GESY)

Entstanden

  • 2006

Ähnliche Objekte (12)