The Effects of Losing a Business Group Affiliation.

Borja Larrain*, Giorgo Sertsios, Francisco Urzúa I

*Autor correspondiente de este trabajo

Producción científica: Contribución a una revistaArtículorevisión exhaustiva

12 Citas (Scopus)


We propose a novel identification strategy for estimating the effects of business group affiliation. We study two-firm business groups, some of which split up during the sample period, leaving some firms as stand-alone firms. We instrument for stand-alone status using shocks to the industry of the other group firm. We find that firms that become stand-alone reduce leverage and investment. Consistent with collateral cross-pledging, the effects are more pronounced when the other firm had high tangibility. Consistent with capital misallocation in groups, the reduction in leverage is stronger in firms that had low (high) profitability (leverage) relative to industry peers.
Idioma originalInglés
Páginas (desde-hasta)3036-3074
Número de páginas39
PublicaciónReview of Financial Studies
EstadoPublicada - 1 ago. 2019

Nota bibliográfica

Publisher Copyright:
© 2018 The Author(s) 2018. Published by Oxford University Press on behalf of The Society for Financial Studies. All rights reserved.


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