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In Search of New Foundations

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Author Info
Zingales, Luigi
Abstract

In this paper I argue that corporate finance theory, empirical research, practical applications, and policy recommendations are deeply rooted in an underlying theory of the firm. I also argue that while the existing theories have delivered very important and useful insights, they seem to be quite ineffective in helping us cope with the new type of firms that are emerging. I outline the characteristics that a new theory of the firm should satisfy and how such a theory could change the way we do corporate finance, both theoretically and empirically.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2551.

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Date of creation: Sep 2000
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Handle: RePEc:cpr:ceprdp:2551

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Keywords: Corporate Finance Foundations New Search

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G30 - Financial Economics - - Corporate Finance and Governance - - - General

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

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    Other versions:
  6. Myers, Stewart C. & Majluf, Nicolás S., 1945-, 1984. "Corporate financing and investment decisions when firms have information that investors do not have," Working papers 1523-84., Massachusetts Institute of Technology (MIT), Sloan School of Management. [Downloadable!]
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  9. Zingales, Luigi, 1995. "What Determines the Value of Corporate Votes?," The Quarterly Journal of Economics, MIT Press, vol. 110(4), pages 1047-73, November. [Downloadable!] (restricted)
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  27. Fluck, Zsuzsanna, 1998. "Optimal Financial Contracting: Debt versus Outside Equity," Review of Financial Studies, Oxford University Press for Society for Financial Studies, vol. 11(2), pages 383-418.
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  31. Zingales, Luigi, 1994. "The Value of the Voting Right: A Study of the Milan Stock Exchange Experience," Review of Financial Studies, Oxford University Press for Society for Financial Studies, vol. 7(1), pages 125-48. [Downloadable!] (restricted)
  32. Hart, O. & Moore, J., 1989. "Default And Renegotiation: A Dynamic Model Of Debt," Working papers 520, Massachusetts Institute of Technology (MIT), Department of Economics.
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  33. Ivo Welch, 1995. "Why is Bankdebt Senior? A Theory of Priority Among Creditors," Finance 18-94, University of California at Los Angeles. [Downloadable!]
  34. Bolton, Patrick & Scharfstein, David S, 1990. "A Theory of Predation Based on Agency Problems in Financial Contracting," American Economic Review, American Economic Association, vol. 80(1), pages 93-106, March. [Downloadable!] (restricted)
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  37. Rafael La Porta & Florencio Lopez-De-Silanes & Andrei Shleifer, 1999. "Corporate Ownership Around the World," Journal of Finance, American Finance Association, vol. 54(2), pages 471-517, 04. [Downloadable!] (restricted)
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  38. Shleifer, Andrei & Vishny, Robert W, 1992. " Liquidation Values and Debt Capacity: A Market Equilibrium Approach," Journal of Finance, American Finance Association, vol. 47(4), pages 1343-66, September. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Francisco Sogorb- Mira, 2002. "How Sme Uniqueness Affects Capital Structure: Evidence From A 1994-1998 Spanish Data Panel," Working Papers. Serie EC 2002-18, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie). [Downloadable!]
  2. Clara Cardone & Maria-Jose Casasola & Margarita Samartin, 2005. "Do Banking Relationships Improve Credit Conditions For Spanish Smes?," Business Economics Working Papers wb052806, Universidad Carlos III, Departamento de Economía de la Empresa. [Downloadable!]
  3. Antti-Jussi Tahvanainen, 2003. "The Capital Structure of Finnish Biotechnology SMEs - An empirical analysisi," Discussion Papers 864, The Research Institute of the Finnish Economy. [Downloadable!]
  4. Clara Cardone & María J. Casasola, 2003. "What Do We Know About The Financial Behaviour Of The Spanish Sme?: An Empirical Analysis," Business Economics Working Papers wb033708, Universidad Carlos III, Departamento de Economía de la Empresa. [Downloadable!]
  5. Dailami, Mansoor & Hauswald, Robert, 2001. "Contract risks and credit spread determinants in the international project bond market," Policy Research Working Paper Series 2712, The World Bank. [Downloadable!]
  6. Peter Wirtz, 2003. "A resource based interpretation of performance enhancing capital structure changes: The O.M. Scott LBO revisited," Working Papers FARGO 1030302, Université de Bourgogne - LEG/Fargo (Research center in Finance,organizational ARchitecture and GOvernance). [Downloadable!]
  7. Schauten, M.B.J. & Spronk, J., 2006. "Optimal Capital Structure: Reflections on Economic and Other Values," Research Paper ERS-2006-074-F&A Revision, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus Uni. [Downloadable!]
  8. Hauswald, Robert & Hege, Ulrich, 2003. "Ownership and Control in Joint Ventures: Theory and Evidence," CEPR Discussion Papers 4056, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  9. Love, Inessa, 2001. "Financial development and financing constraints - international evidence from the structural investment model," Policy Research Working Paper Series 2694, The World Bank. [Downloadable!]
  10. Dyck, Alexander & Zingales, Luigi, 2002. "The Corporate Governance Role of the Media," CEPR Discussion Papers 3630, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  11. Miguel A. Garcia-Cestona, 2001. "Ownership Structure, Banks and the Role of Stakeholders: The Spanish Case," CEI Working Paper Series 2001-20, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
  12. Oliver Hart, 2001. "Financial Contracting," NBER Working Papers 8285, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  13. Gérard Charreaux, 2001. "Variation sur le thème 'A la recherche de nouvelles fondations pour la finance et la gouvernance d'entreprise'," Working Papers FARGO 011201, Université de Bourgogne - LEG/Fargo (Research center in Finance,organizational ARchitecture and GOvernance), revised Jul 2002. [Downloadable!]
    Other versions:
  14. HIROTA Shinichi & KUBO Katsuyuki & MIYAJIMA Hideaki, 2007. "Does Corporate Culture Matter? An Empirical Study on Japanese Firms," Discussion papers 07030, Research Institute of Economy, Trade and Industry (RIETI). [Downloadable!]
  15. Francisco Sogorb- Mira & José Lopez- Gracia, 2003. "Pecking Order Versus Trade-Off: An Empirical Approach To The Small And Medium Enterprise Capital Structure," Working Papers. Serie EC 2003-09, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie). [Downloadable!]
  16. Stewart C. Myers, 2001. "Capital Structure," Journal of Economic Perspectives, American Economic Association, vol. 15(2), pages 81-102, Spring. [Downloadable!] (restricted)
  17. Pascal Louvet & Ollivier Taramasco, 2004. "Gouvernement d’entreprise:un modèle de répartition de la valeur créée entre dirigeant et actionnaire," Revue Finance Contrôle Stratégie, Editions Economica, vol. 7(1), pages 81-116, March. [Downloadable!]
  18. Frank A. Schmid, 2001. "Equity financing of the entrepreneurial firm," Review, Federal Reserve Bank of St. Louis, issue Nov., pages 15-28. [Downloadable!]
  19. Thierry Burger-Helmchen, 2006. "Option chain and change management : a structural equation application," Working Papers of BETA 2006-28, Bureau d'Economie Théorique et Appliquée, ULP, Strasbourg. [Downloadable!]
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