Search results: 50.
The Market for Corporate Assets: Who Engages in Mergers and Asset Sales and Are There Efficiency Gains?
Published: 12/2001, Volume: 56, Issue: 6 | DOI: 10.1111/0022-1082.00398 | Cited by: 647
Vojislav Maksimovic, Gordon Phillips
We analyze the market for corporate assets. There is an active market for corporate assets, with close to seven percent of plants changing ownership annually through mergers, acquisitions, and asset sales in peak expansion years. The probability of asset sales and whole‐firm transactions is related to firm organization and ex ante efficiency of buyers and sellers. The timing of sales and the pattern of efficiency gains suggests that the transactions that occur, especially through asset sales of plants and divisions, tend to improve the allocation of resources and are consistent with a simple neoclassical model of profit maximizing by firms.
Do Conglomerate Firms Allocate Resources Inefficiently Across Industries? Theory and Evidence
Published: 4/2002, Volume: 57, Issue: 2 | DOI: 10.1111/1540-6261.00440 | Cited by: 601
Vojislav Maksimovic, Gordon Phillips
We develop a profit‐maximizing neoclassical model of optimal firm size and growth across different industries based on differences in industry fundamentals and firm productivity. In the model, a conglomerate discount is consistent with profit maximization. The model predicts how conglomerate firms will allocate resources across divisions over the business cycle and how their responses to industry shocks will differ from those of single‐segment firms. Using plant level data, we find that growth and investment of conglomerate and single‐segment firms is related to fundamental industry factors and individual segment level productivity. The majority of conglomerate firms exhibit growth across industry segments that is consistent with optimal behavior.
Asset Efficiency and Reallocation Decisions of Bankrupt Firms
Published: 10/1998, Volume: 53, Issue: 5 | DOI: 10.1111/0022-1082.00063 | Cited by: 149
VOJISLAV MAKSIMOVIC, GORDON PHILLIPS
This paper investigates whether Chapter 11 bankruptcy provides a mechanism by which insolvent firms are efficiently reorganized and the assets of unproductive firms are effectively redeployed. We argue that incentives to reorganize depend on the level of demand and industry conditions. Using plant‐level data, we find that Chapter 11 status is much less important than industry conditions in explaining the productivity, asset sales, and closure conditions of Chapter 11 bankrupt firms. This suggests that firms that elect to enter into Chapter 11 incur few real economic costs.
Real and Financial Industry Booms and Busts
Published: 1/13/2010, Volume: 65, Issue: 1 | DOI: 10.1111/j.1540-6261.2009.01523.x | Cited by: 306
GERARD HOBERG, GORDON PHILLIPS
We examine how product market competition affects firm cash flows and stock returns in industry booms and busts. Our results show how real and financial factors interact in industry business cycles. In competitive industries, we find that high industry‐level stock market valuation, investment, and financing are followed by sharply lower operating cash flows and abnormal stock returns. Analyst estimates are positively biased and returns comove more. In concentrated industries these relations are weak and generally insignificant. Our results are consistent with participants in competitive industries not fully internalizing the negative externality of industry competition on cash flows and stock returns.
The Industry Life Cycle, Acquisitions and Investment: Does Firm Organization Matter?
Published: 4/2008, Volume: 63, Issue: 2 | DOI: 10.1111/j.1540-6261.2008.01328.x | Cited by: 143
VOJISLAV MAKSIMOVIC, GORDON PHILLIPS
We examine the effect of industry life‐cycle stages on within‐industry acquisitions and capital expenditures by conglomerates and single‐segment firms controlling for endogeneity of organizational form. We find greater differences in acquisitions than in capital expenditures, which are similar across organizational types. In particular, 36% of the growth recorded by conglomerate segments in growth industries comes from acquisitions, versus 9% for single‐segment firms. In growth industries, the effect of financial dependence on acquisitions and plant openings is mitigated for conglomerate firms. Plants acquired by conglomerate firms increase in productivity. The results suggest that organizational forms' comparative advantages differ across industry conditions.
Scope, Scale, and Concentration: The 21st‐Century Firm
Published: 11/4/2024, Volume: 80, Issue: 1 | DOI: 10.1111/jofi.13400 | Cited by: 74
GERARD HOBERG, GORDON M. PHILLIPS
We provide evidence using firm 10‐Ks that over the past 30 years, U.S. firms have expanded their scope of operations. Increases in scope were achieved largely without increasing traditional operating segments. Scope expansion significantly increases valuation and is realized primarily through acquisitions and investment in R&D, but not through capital expenditures. Traditional concentration ratios do not capture this expansion of scope. Our findings point to a new type of firm that increases scope through related expansion, which is highly valued by the market.
Corporate Equity Ownership, Strategic Alliances, and Product Market Relationships
Published: 12/2000, Volume: 55, Issue: 6 | DOI: 10.1111/0022-1082.00307 | Cited by: 480
Jeffrey W. Allen, Gordon M. Phillips
This paper examines long‐term block ownership by corporations and performance changes in firms with corporate block owners. We also examine potential reasons for corporate ownership including benefits in product market relationships, alleviation of financing constraints, and board monitoring by corporate owners. We find the largest significant increases in targets' stock prices, investment, and operating profitability when ownership is combined with alliances, joint ventures, and other product market relationships between purchasing and target firms, especially in industries with high research and development. Our findings are consistent with the conclusion that block ownership by corporations has significant benefits in product market relationships.
Product Market Threats, Payouts, and Financial Flexibility
Published: 1/7/2014, Volume: 69, Issue: 1 | DOI: 10.1111/jofi.12050 | Cited by: 1068
GERARD HOBERG, GORDON PHILLIPS, NAGPURNANAND PRABHALA
We examine how product market threats influence firm payout policy and cash holdings. Using firms' product text descriptions, we develop new measures of competitive threats. Our primary measure, product market fluidity, captures changes in rival firms' products relative to the firm's products. We show that fluidity decreases firm propensity to make payouts via dividends or repurchases and increases the cash held by firms, especially for firms with less access to financial markets. These results are consistent with the hypothesis that firms' financial policies are significantly shaped by product market threats and dynamics.
Private and Public Merger Waves
Published: 9/10/2013, Volume: 68, Issue: 5 | DOI: 10.1111/jofi.12055 | Cited by: 218
VOJISLAV MAKSIMOVIC, GORDON PHILLIPS, LIU YANG
We document that public firms participate more than private firms as buyers and sellers of assets in merger waves and their participation is affected more by credit spreads and aggregate market valuation. Public firm acquisitions realize higher gains in productivity, particularly for on‐the‐wave acquisitions and when the acquirer's stock is liquid and highly valued. Our results are not driven solely by public firms' better access to capital. Using productivity data from early in the firm's life, we find that better private firms subsequently select to become public. Initial size and productivity predict asset purchases and sales 10 and more years later.
The Impact of Bank Credit on Labor Reallocation and Aggregate Industry Productivity
Published: 10/14/2018, Volume: 73, Issue: 6 | DOI: 10.1111/jofi.12726 | Cited by: 170
JOHN (JIANQIU) BAI, DANIEL CARVALHO, GORDON M. PHILLIPS
We provide evidence that the deregulation of U.S. state banking markets leads to a significant increase in the relative employment and capital growth of local firms with higher productivity, and that this effect is concentrated among young firms. Using financial data for a broad range of firms, our analysis suggests that this effect is driven by a shift in the composition of local bank credit supply toward more productive firms. We estimate that this effect translates into economically important gains in aggregate industry productivity and that changes in the allocation of labor play a central role in driving these gains.
COMPETITION, CONFUSION, AND COMMERCIAL BANKING*
Published: 3/1964, Volume: 19, Issue: 1 | DOI: 10.1111/j.1540-6261.1964.tb00743.x | Cited by: 2
Almarin Phillips
REPLY
Published: 12/1968, Volume: 23, Issue: 5 | DOI: 10.1111/j.1540-6261.1968.tb00323.x | Cited by: 0
GORDON PYE
A NOTE ON THIS PROCEEDINGS ISSUE
Published: 5/1975, Volume: 30, Issue: 2 | DOI: 10.1111/j.1540-6261.1975.tb01808.x | Cited by: 0
Myron Gordon
THE VALUE OF CALL DEFERMENT ON A BOND: SOME EMPIRICAL RESULTS1
Published: 12/1967, Volume: 22, Issue: 4 | DOI: 10.1111/j.1540-6261.1967.tb00297.x | Cited by: 3
Gordon Pye
Transparency and Liquidity: A Study of Block Trades on the London Stock Exchange under Different Publication Rules
Published: 12/1996, Volume: 51, Issue: 5 | DOI: 10.1111/j.1540-6261.1996.tb05225.x | Cited by: 160
GORDON GEMMILL
This article examines whether reducing a market's transparency, by delaying the publication of prices for block trades, has any impact on liquidity. The analysis uses a sample of 5987 blocks from the London Stock Exchange that cover three different publication regimes: immediate (1987/88), 90 minutes (1991/92), and 24 hours (1989/90). Delaying publication does not affect the time taken by prices to reach a new level, which is rapid under all regimes. Spreads differ across years, but their size relates more closely to market volatility than to speed of publication. There is therefore no gain in liquidity from delayed publication.
THE COST OF EQUITY CAPITAL: A RECONSIDERATION
Published: 6/1978, Volume: 33, Issue: 3 | DOI: 10.1111/j.1540-6261.1978.tb02026.x | Cited by: 26
Myron J. Gordon, M. J. Gordon, L. I. Gould
THE FEDERAL HOME LOAN BANK SYSTEM AND THE CONTROL OF CREDIT
Published: 9/1957, Volume: 12, Issue: 3 | DOI: 10.1111/j.1540-6261.1957.tb04141.x | Cited by: 0
Gordon W. McKinley
LIFE INSURANCE COMPANY LENDING TO SMALL BUSINESS
Published: 5/1961, Volume: 16, Issue: 2 | DOI: 10.1111/j.1540-6261.1961.tb02827.x | Cited by: 0
Gordon W. McKinley
DISCUSSION
Published: 5/1980, Volume: 35, Issue: 2 | DOI: 10.1111/j.1540-6261.1980.tb02181.x | Cited by: 5
Gordon C. Rausser
OPTIMAL INVESTMENT AND FINANCING POLICY*
Published: 5/1963, Volume: 18, Issue: 2 | DOI: 10.1111/j.1540-6261.1963.tb00722.x | Cited by: 109
M. J. Gordon
Can Capital Income Taxes Survive in Open Economies?
Published: 7/1992, Volume: 47, Issue: 3 | DOI: 10.1111/j.1540-6261.1992.tb04009.x | Cited by: 99
ROGER H. GORDON
Optimal‐tax theory forecasts that small open economies should not tax capital income. Yet, countries do tax capital income. Why the inconsistency? This paper shows that use of the double‐taxation convention, whereby governments credit taxes paid abroad against domestic taxes, helps explain this inconsistency. In particular, capital income will be taxed if a dominant capital exporter acts as a Stackelberg leader when setting its tax policy. Due to the convention, other countries will then tax capital imports, making it attractive for the dominant capital exporter to tax capital income. Without a dominant capital exporter, however, the model still forecasts no capital‐income taxes.
AN ECONOMETRIC ANALYSIS OF THE ROLE OF FINANCIAL INTERMEDIARIES IN POSTWAR RESIDENTIAL BUILDING CYCLES*
Published: 3/1966, Volume: 21, Issue: 1 | DOI: 10.1111/j.1540-6261.1966.tb02970.x | Cited by: 0
Gordon R. Sparks
REPLY
Published: 12/1958, Volume: 13, Issue: 4 | DOI: 10.1111/j.1540-6261.1958.tb04222.x | Cited by: 0
Gordon W. McKinley
A PORTFOLIO THEORY OF THE SOCIAL DISCOUNT RATE AND THE PUBLIC DEBT*
Published: 5/1976, Volume: 31, Issue: 2 | DOI: 10.1111/j.1540-6261.1976.tb01881.x | Cited by: 3
Myron J. Gordon
Short Selling and Efficient Sets
Published: 9/1993, Volume: 48, Issue: 4 | DOI: 10.1111/j.1540-6261.1993.tb04764.x | Cited by: 12
GORDON J. ALEXANDER
The effect of short selling on the composition and location of the efficient set has been analyzed in a variety of ways. However, the situation typically facing investors where the initial margin requirement is less than 100 percent and the riskfree interest rate that is paid on the short proceeds is less than the rate paid on initial margin has not previously been considered. The Elton‐Gruber‐Padberg algorithm (1976, 1978), subject to certain modifications, is shown here to be capable of identifying the efficient set under such conditions.
THE FUTURE OF THE CORPORATION INCOME TAX
Published: 5/1956, Volume: 11, Issue: 2 | DOI: 10.1111/j.1540-6261.1956.tb00701.x | Cited by: 0
E. Gordon Keith
A GENERAL SOLUTION TO THE BUY OR LEASE DECISION: A PEDAGOGICAL NOTE
Published: 3/1974, Volume: 29, Issue: 1 | DOI: 10.1111/j.1540-6261.1974.tb00040.x | Cited by: 20
Myron J. Gordon
ENDOGENOUS ENDOWMENTS AND CAPITAL ASSET PRICES
Published: 3/1975, Volume: 30, Issue: 1 | DOI: 10.1111/j.1540-6261.1975.tb03167.x | Cited by: 0
Gordon S. Roberts
A SUGGESTION FOR THE CONTROL OF PEACETIME INFLATION*
Published: 12/1949, Volume: 4, Issue: 4 | DOI: 10.1111/j.1540-6261.1949.tb02359.x | Cited by: 0
David Gordon Tyndall
SECURITY AND INVESTMENT: THEORY AND EVIDENCE*
Published: 12/1964, Volume: 19, Issue: 4 | DOI: 10.1111/j.1540-6261.1964.tb02887.x | Cited by: 0
Myron J. Gordon
The Impact of Real Factors and Inflation on the Performance of the U.S. Stock Market From 1960 to 1980
Published: 5/1983, Volume: 38, Issue: 2 | DOI: 10.1111/j.1540-6261.1983.tb02263.x | Cited by: 5
MYRON J. GORDON
TOWARDS A THEORY OF FINANCIAL DISTRESS
Published: 5/1971, Volume: 26, Issue: 2 | DOI: 10.1111/j.1540-6261.1971.tb00902.x | Cited by: 84
M. J. Gordon
DISCUSSION
Published: 5/1973, Volume: 28, Issue: 2 | DOI: 10.1111/j.1540-6261.1973.tb01775.x | Cited by: 0
Myron J. Gordon
COMPARISON OF HISTORICAL COST AND GENERAL PRICE LEVEL ADJUSTED COST RATE BASE REGULATION
Published: 12/1977, Volume: 32, Issue: 5 | DOI: 10.1111/j.1540-6261.1977.tb03350.x | Cited by: 8
Myron J. Gordon
THE COMMISSION ON FINANCIAL STRUCTURE AND REGULATION: ITS ORGANIZATION AND RECOMMENDATIONS
Published: 5/1972, Volume: 27, Issue: 2 | DOI: 10.1111/j.1540-6261.1972.tb00962.x | Cited by: 0
Donald P. Jacobs, Almarin Phillips
THE EFFECT OF DEPOSIT RATE CEILINGS ON AGGREGATE INCOME
Published: 12/1972, Volume: 27, Issue: 5 | DOI: 10.1111/j.1540-6261.1972.tb03020.x | Cited by: 1
Gordon Pye, Ian Young
Thirty‐third Annual Meetings American Finance Association San Francisco, California, December 28–30, 1974
Published: 9/1974, Volume: 29, Issue: 4 | DOI: 10.1111/j.1540-6261.1974.tb03118.x | Cited by: 0
John Lintner, Myron Gordon
Capital Structure and Corporate Control: The Effect of Antitakeover Statutes on Firm Leverage
Published: 4/1999, Volume: 54, Issue: 2 | DOI: 10.1111/0022-1082.00116 | Cited by: 302
Gerald T. Garvey, Gordon Hanka
We find that firms protected by “second generation” state antitakeover laws substantially reduce their use of debt, and that unprotected firms do the reverse. This result supports recent models in which the threat of hostile takeover motivates managers to take on debt they would otherwise avoid. An implication is that legal barriers to takeovers may increase corporate slack.
A General Equilibrium Simulation Study of Subsidies to Municipal Expenditures
Published: 5/1983, Volume: 38, Issue: 2 | DOI: 10.1111/j.1540-6261.1983.tb02268.x | Cited by: 6
ROGER H. GORDON, JOEL SLEMROD
The Expiration of IPO Share Lockups
Published: 4/2001, Volume: 56, Issue: 2 | DOI: 10.1111/0022-1082.00334 | Cited by: 372
Laura Casares Field, Gordon Hanka
We examine 1,948 share lockup agreements that prevent insiders from selling their shares in the period immediately after the IPO (typically 180 days). While lockups are in effect, there is little selling by insiders. When lockups expire, we find a permanent 40 percent increase in average trading volume, and a statistically prominent three‐day abnormal return of −1.5 percent. The abnormal return and volume are much larger when the firm is financed by venture capital, and we find that venture capitalists sell more aggressively than executives and other shareholders. We find limited support for several hypotheses that may explain the abnormal return, but no complete explanation.
Information, Ownership Structure, and Shareholder Voting: Evidence from Shareholder‐Sponsored Corporate Governance Proposals
Published: 6/1993, Volume: 48, Issue: 2 | DOI: 10.1111/j.1540-6261.1993.tb04734.x | Cited by: 114
LILLI A. GORDON, JOHN POUND
This paper examines how information and ownership structure affect voting outcomes on shareholder‐sponsored proposals to change corporate governance structure. We find that the outcomes of votes vary systematically with the governance and performance records of target firms, the identity of proposal sponsors, and the type of proposal. We also find that outcomes vary significantly as a function of ownership by insiders, institutions, outside blockholders, ESOPs, and outside directors who are blockholders. These results suggest that both public information and ownership structure have a significant influence on voting outcomes.
Firm Valuation, Earnings Expectations, and the Exchange‐Rate Exposure Effect
Published: 12/1994, Volume: 49, Issue: 5 | DOI: 10.1111/j.1540-6261.1994.tb04780.x | Cited by: 318
ELI BARTOV, GORDON M. BODNAR
Consistent with previous research, we fail to find a significant correlation between the abnormal returns of our sample firms with international activities and changes in the dollar. We investigate the possibility that this failure is due to mispricing. Lagged changes in the dollar are a significant variable in explaining current abnormal returns of our sample firms, suggesting that mispricing does occur. A simple trading strategy based upon these results generates significant abnormal returns. Corroborating evidence from returns around earnings announcements as well as errors in analysts' forecasts of earnings is also provided.
Distinguishing Beliefs and Preferences in Equilibrium Prices
Published: 5/1980, Volume: 35, Issue: 2 | DOI: 10.1111/j.1540-6261.1980.tb02162.x | Cited by: 5
ALAN KRAUS, GORDON A. SICK
Noise Trading, Costly Arbitrage, and Asset Prices: Evidence from Closed‐end Funds
Published: 12/2002, Volume: 57, Issue: 6 | DOI: 10.1111/1540-6261.00506 | Cited by: 155
Gordon Gemmill, Dylan C. Thomas
If arbitrage is costly and noise traders are active, asset prices may deviate from fundamental values for long periods of time. We use a sample of 158 closed‐end funds to show that noise‐trader sentiment, as proxied by retail‐investor flows, leads to fluctuations in the discount. Nevertheless, we reject the hypothesis that noise‐trader risk is the cause of the long‐run discount. Instead we find that funds which are more difficult to arbitrage have larger discounts, due to: (1) the censoring of the discount by the arbitrage bounds, and (2) the freedom of managers to increase charges when arbitrage is costly.
COST OF CAPITAL FOR A DIVISION OF A FIRM: REPLY
Published: 12/1977, Volume: 32, Issue: 5 | DOI: 10.1111/j.1540-6261.1977.tb03374.x | Cited by: 0
Myron J. Gordon, Paul J. Halpern
MANAGEMENT AND OWNERSHIP IN THE LARGE FIRM
Published: 5/1969, Volume: 24, Issue: 2 | DOI: 10.1111/j.1540-6261.1969.tb01684.x | Cited by: 4
Myron J. Gordon, Wilbur G. Lewellen
TEMPORAL PRICE BEHAVIOR IN COMMODITY FUTURES MARKETS*
Published: 9/1975, Volume: 30, Issue: 4 | DOI: 10.1111/j.1540-6261.1975.tb01020.x | Cited by: 20
Thomas F. Cargill, Gordon C. Rausser
COST OF CAPITAL FOR A DIVISION OF A FIRM
Published: 9/1974, Volume: 29, Issue: 4 | DOI: 10.1111/j.1540-6261.1974.tb03093.x | Cited by: 22
Myron J. Gordon, Paul J. Halpern
DISCUSSION
Published: 5/1965, Volume: 20, Issue: 2 | DOI: 10.1111/j.1540-6261.1965.tb00210.x | Cited by: 0
MELVIN I. WHITE, E. GORDON KEITH