TY - JOUR
AU1 - Hoshi,, Takeo
AU2 - Kashyap,, Anil
AU3 - Scharfstein,, David
AB - Abstract This paper presents evidence suggesting that information and incentive problems in the capital market affect investment. We come to this conclusion by examining two sets of Japanese firms. The first set has close financial ties to large Japanese banks that serve as their primary source of external finance and are likely to be well informed about the firm. The second set of firms has weaker links to a main bank and presumably faces greater problems raising capital. Investment is more sensitive to liquidity for the second set of firms than for the first set. The analysis also highlights the role of financial intermediaries in the investment process. * " We are grateful for helpful comments from Olivier Blanchard, Ken Froot, Fred Furlong, Robert Gertner, Glenn Hubbard, Carl Rester, Andrew Lo, Tim Luehrman, John McMillan, Jim Poterba, Julio Rotemberg, Andrei Shleifer, Masahiko Takeda, Robert Vishny, David Wilcox, Jeff Wooldridge, Stephen Zeldes, the referees, and seminar participants at the University of California (Berkeley and Davis), the Garn Institute, MIT, Michigan, the National Bureau of Economic Research, Northwestern, Rochester, Stanford, and the Western Finance Association Meetings. We thank the Nikkei Data Bank Bureau for generously providing us with the data and MIT's International Financial Services Research Center and the Olin Foundation for financial support. The views expressed in this paper are those of the authors and do not necessarily reflect the opinions of the Board of Governors or its staff. This content is only available as a PDF. © 1991 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology
TI - Corporate Structure, Liquidity, and Investment: Evidence from Japanese Industrial Groups
JF - The Quarterly Journal of Economics
DO - 10.2307/2937905
DA - 1991-02-01
UR - https://www.deepdyve.com/lp/oxford-university-press/corporate-structure-liquidity-and-investment-evidence-from-japanese-8dyA55O07f
SP - 33
VL - 106
IS - 1
DP - DeepDyve
ER -