The strategic impact of resource flexibility in business groups

RAND Journal of Economics

Volumn 36, Issue 1, 2005, Pages 193-214

  Cestone, Giacinta ^a   Fumagalli, Chiara ^b  

^a Barcelona)   (Italy)

^b BOCCONI UNIVERSITY   (Italy)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 21644482759     PISSN: 07416261     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (55)

1. AGHION, P., DEWATRIPONT, M., AND REY, P. "Agency Costs, Firm Behaviour and the Nature of Competition." Working Paper no. 77, Institut d'Economie Industrielle, Université de Toulouse, 1998.
2. ANTUNES, J.E. Liability of Corporate Groups: Autonomy and Control in Parent-Subsidiary Relationships in US, German and EU Law. Boston: Kluwer, 1994.
3. BEBCHUK, L.A., KRAAKMAN, R., AND TRIANTIS, G. "Stock Pyramids, Cross-Ownership, and Dual Class Equity." In R. Morck, ed., Concentrated Corporate Ownership. Chicago: University of Chicago Press, 2000.
4. BENOIT, J. "Financially Constrained Entry in a Game with Incomplete Information." RAND Journal of Economics, Vol. 15 (1984), pp. 490-499.
5. BIANCHI, M., BIANCO, M., AND ENRIQUES, L. "Ownership, Pyramidal Groups and the Separation between Ownership and Control in Italy." In The Separation of Ownership and Control: A Survey of 7 European Countries. Preliminary Report to the European Commission, Vol. 3. Brussels: European Corporate Governance Network, 1997.
6. BIANCO, M. AND NICODANO, G. "Business Groups and Debt." Mimeo, Bank of Italy and Università di Torino, 2002.
7. BLUMBERG, P.I. The Law of Corporate Groups: Problems of Parent and Subsidiary Corporations Under Statutory Law of General Application. Boston: Little, Brown, 1989.
8. BOLTON, P. AND SCHARFSTEIN, D.S. "A Theory of Predation Based on Agency Problems in Financial Contracting." American Economic Review, Vol. 80 (1990), pp. 93-106.
9. BRANDER, J.A. AND LEWIS, T.R. "Oligopoly and Financial Structure: The Limited Liability Effect." American Economic Review, Vol. 76 (1986), pp. 956-970.
10. BROCK, G.W. "The Computer Industry." In W. Adams, ed., The Structure of the American Industry, 7th ed. New York: Macmillan, 1986.
11. BRUSCO, S. AND PANUNZI, F. "Reallocation of Corporate Resources and Managerial Incentives in Internal Capital Markets." European Economic Review, Vol. 49 (2005), pp. 659-681.
12. BULOW, J.I., GEANAKOPLOS, J.D., AND KLEMPERER, P.D. "Multimarket Oligopoly: Strategic Substitutes and Complements." Journal of Political Economy, Vol. 93 (1985), pp. 488-511.
13. CAVES, R.E. Multinational Enterprise and Economic Analysis. New York: Cambridge University Press, 1982.
14. CESTONE, G. AND FUMAGALLI, C. "Internal Capital Markets, Cross-Subsidization, and Product Market Competition." CEPR Discussion Paper no. 2935, 2001.
15. AND WHITE, L. "Anticompetitive Financial Contracting: The Design of Financial Claims." Journal of Finance, Vol. 58 (2003), pp. 2109-2142.
16. CHEVALIER, J. "What Do We Know About Cross-Subsidization? Evidence from Merging Firms." Advances in Economic Analysis & Policy, Vol. 4 (2004).
17. CLAESSENS, S., DJANKOV, S., AND KLAPPER, L. "The Role and Functioning of Business Groups in East Asia and Chile." Revista ABANTE, Vol. 3 (2000), pp. 97-107.
18. D'ASPREMONT, C. AND JACQUEMIN, A. "Cooperative and Noncooperative R&D in Duopoly with Spillovers." American Economic Review, Vol. 78 (1988), pp. 1133-1137.
19. DIAMOND, D. "Financial Intermediation and Delegated Monitoring." Review of Economic Studies, Vol. 51 (1984), pp. 393-414.
20. DUNNE, T., ROBERTS, M., AND SAMUELSON, L. "Patterns of Firm Entry and Exit in U.S. Manufacturing Industries." RAND Journal of Economics, Vol. 19 (1988), pp. 495-515.
21. EDWARDS, C.D. "Conglomerate Bigness as a Source of Power." In W.C. Mitchell, ed., Business Concentration and Price Policy (NBER Special Conference Series). Princeton, N J.: Princeton University Press, 1955.
22. ELZINGA, K.G. "Collusive Prédation: Matsushita Versus Zenith (1986)." In J.E. Kwoka and L.E. White, eds., The Antitrust Revolution, 3d. ed. New York: Oxford University Press, 1999.
23. EUROPEAN CORPORATE GOVERNANCE NETWORK. The Separation of Ownership and Control: A Survey of 7 European Countries. Preliminary Report to the European Commission. Brussels: European Corporate Governance Network, 1997.
24. FERRIS, S.P., KIM, K.A., AND KITSABUNNARAT, P. "The Costs (and Benefits?) of Diversified Business Groups: The Case of Korean Chaebols." Journal of Banking and Finance, Vol. 27 (2003), pp. 251-273.
25. FLUCK, Z. AND LYNCH, A. "Why Do Firms Merge and Then Divest? A Theory of Financial Synergy." Journal of Business, Vol. 72 (1999), pp. 319-346.
26. FUDENBERG, D. AND TIROLE, J. "The Fat Cat Effect, The Puppy Dog Play and the Lean and Hungry Look." American Economic Review, Vol. 74 (1984), pp. 361-366.
27. GERTNER, R.H., SCHARFSTEIN, D.S., AND STEIN, J.C. "Internal Versus External Capital Markets." Quarterly Journal of Economics, Vol. 109 (1994), pp. 1211-1230.
28. HADDEN, T. The Control of Corporate Groups. London: Institute of Advanced Legal Studies, 1983.
29. HOLMSTRÖM, B. AND TIROLE, J. "Financial Intermediation, Loanable Funds and the Real Sector." Quarterly Journal of Economics, Vol. 112 (1997), pp. 663-691.
30. HOUSTON, J. AND JAMES, C. "Do Bank Internal Capital Markets Promote Lending?" Journal of Banking and Finance, Vol. 22 (1998), pp. 899-918.
31. _,_, AND MARCUS, D. "Capital Market Frictions and the Role of Internal Capital Markets in Banking." Journal of Financial Economics, Vol. 46 (1997), pp. 135-64.
32. KHANNA, T. "Business Groups and Social Welfare in Emerging Markets." European Economic Review, Vol. 44 (2000), pp. 748-761.
33. _ AND TICE, S. "The Bright Side of Internal Capital Markets." Journal of Finance, Vol. 56 (2001), pp. 1489-1531.
34. LA PORTA, R., LOPEZ-DE-SILANES, F., AND SHLEIFER, A. "Corporate Ownership Around the World." Journal of Finance, Vol. 54 (1999), pp. 471-517.
35. LAWRENCE, R. "Efficient or Exclusionist? The Import Behavior of Japanese Corporate Groups." Brookings Papers on Economic Activity, (1991), pp. 311-330.
36. Li, D. AND Li, S. "A Theory of Corporate Scope and Financial Structure." Journal of Finance, Vol. 51 (1996), pp. 691-709.
37. MAKSIMOVIC, V. "Capital Structure in Repeated Oligopolies." RAND Journal of Economics, Vol. 19 (1988), pp. 389-407.
38. MATSUSAKA, J. AND NANDA, V. "Internal Capital Markets and Corporate Refocusing." Journal of Financial Intermediation, Vol. 11 (2002), pp. 176-211.
39. MEYER, M., MILGROM, P., AND ROBERTS, J. "Organizational Prospects, Influence Costs, and Ownership Changes." Journal of Economics and Management Strategy, Vol. 1 (1992), pp. 9-35.
40. NICODANO, G. "Business Groups: Are They More Efficient Than Conglomerates and Stand-Alone Units?" Mimeo, Université di Torino, 2003.
41. PEROTTI, E. AND GELFER, S. "Red Barons or Robber Barons? Governance and Investment in Russian Financial-Industrial Groups." European Economic Review, Vol. 45 (2001), pp. 1601-1617.
42. POITEVIN, M. "Financial Signalling and the 'Deep-Pocket' Argument." RAND Journal of Economics, Vol. 20 (1989), pp. 26-40.
43. RAJAN, R., SERVAES, H., AND ZINGALES, L. "The Cost of Diversity: The Diversification Discount and Inefficient Investment." Journal of Finance, Vol. 55 (2000), pp. 35-80.
44. Rossi, G. "II Fenomeno dei Gruppi ed il Diritto Societario." In P. Balzarini, G. Carcano, and G. Mucciarelli, eds., I Gruppi di Società. Atti del Convegno Internationale di Studi: Venezia 16-17-18 Novembre 1995. Milano: Giuffrè Editore, 1996.
45. SAMPHANTHARAK, K. "Internal Capital Markets in Business Groups." Mimeo, University of Chicago, 2003.
46. SCHARFSTEIN, D. "The Dark Side of Inernal Capital Markets II: Evidence from Diversified Conglomerates." NBER Working Paper no. 6352, 1998.
47. _ AND STEIN, J.C. "The Dark Side of Internal Capital Markets: Divisional Rent-Seeking and Inefficient Investment." Journal of Finance, Vol. 55 (2000), pp. 2537-2564.
48. SHIN, H.-H. AND STULZ, R. "Are Internal Capital Markets Efficient?" Quarterly Journal of Economics, Vol. 113 (1998), pp. 531-552.
49. SPAGNOLO, G. "Stock-Related Compensation and Product-Market Competition." RAND Journal of Economics, Vol. 31 (2000), pp. 22-42.
50. STEIN, J.C. "Internal Capital Markets and the Competition for Corporate Resources." Journal of Finance, Vol. 52 (1997), pp. 111-133.
51. TEECE, D.J. "Towards an Economic Theory of the Multiproduct Firm." Journal of Economic Behavior and Organization, Vol. 3 (1982), pp. 39-63.
52. TELSER, L.G. "Cutthroat Competition and the Long Purse." Journal of Law and Economics, Vol. 9 (1966), pp. 259-277.
53. VAN WITTELOOSTUIJN, A. AND VAN WEGBERG, M. "Multimarket Competition. Theory and Evidence." Journal of Economic Behavior and Organization, Vol. 18 (1992), pp. 273-282.
54. WEINSTEIN, D.E. AND YAFEH, Y. "Japanese Corporate Groups: Collusive or Competitive? An Empirical Investigation of Keiretsu Behavior." Journal of Industrial Economics, Vol. 43 (1995), pp. 9-376.
55. WOLFENZON, D. "A Theory of Pyramidal Ownership." Mimeo, Harvard University, 1999.