Financial Dependence and Firm Survival in Interwar Britain
Was the London Stock Exchange (LSE) little more than a Dickensian den of speculation, or did it make a contribution to industrial development in Interwar Britain?� The interwar stock market laboured under problems of weak disclosure, inadequate investor protection and ineffective underwriting.� New manufacturing industries were the most vulnerable to resulting asymmetric information problems.� Drawing on a new database of IPOs on the London Stock Exchange between 1919 and 1938, I conclude that new manufacturing firms were finance-constrained.� Consistent with the Rajan-Zingales financial dependence hypothesis, this result reflects the weak interwar institutional environment.� The disastrous IPO survival rates of the late 1920s provide further evidence of this weak environment.� Yet, when issue activity rebounded strongly in the following decade, a dramatic improvement in survival ensued, due, in part, to the efforts of the LSE.� This was an early example of the "light touch" regulatory approach for which London has subsequently become renowned.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
| Length: | |
| Date of creation: | 01 Dec 2007 |
| Date of revision: | |
| Handle: | RePEc:oxf:wpaper:377 |
| Contact details of provider: | Postal: Web page: http://www.economics.ox.ac.uk/Email: More information through EDIRC
|
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.:
- Katherine Watson, 1996. "Banks and industrial finance: the experience of brewers, 1880-1913," Economic History Review, Economic History Society, vol. 49(1), pages 58-81, 02.
- Shumway, Tyler, 2001. "Forecasting Bankruptcy More Accurately: A Simple Hazard Model," The Journal of Business, University of Chicago Press, vol. 74(1), pages 101-24, January.
- Julian Franks & Colin Mayer & Stefano Rossi, 2003.
"Ownership: Evolution and Regulation,"
OFRC Working Papers Series
2003fe14, Oxford Financial Research Centre.
- Julian Franks & Colin Mayer & Stefano Rossi, 2009. "Ownership: Evolution and Regulation," Review of Financial Studies, Society for Financial Studies, vol. 22(10), pages 4009-4056, October.
- Colin Mayer & Julian Franks, 2003. "Ownership: Evolution and Regulation," Economics Series Working Papers 2003-FE-14, University of Oxford, Department of Economics.
- David Strömberg, 2004. "Radio's Impact on Public Spending," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 189-221, February.
- Paul A. Gompers & Josh Lerner, 2001.
"The Really Long-Run Performance of Initial Public Offerings: The Pre-NASDAQ Evidence,"
NBER Working Papers
8505, National Bureau of Economic Research, Inc.
- Paul A. Gompers & Josh Lerner, 2003. "The Really Long-Run Performance of Initial Public Offerings: The Pre-Nasdaq Evidence," Journal of Finance, American Finance Association, vol. 58(4), pages 1355-1392, 08.
- David Chambers & Elroy Dimson, 2009. "IPO Underpricing over the Very Long Run," Journal of Finance, American Finance Association, vol. 64(3), pages 1407-1443, 06.
- James S. Foreman-Peck, 1985. "Seedcorn or Chaff? New Firm Formation and the Performance of the Interwar Economy," Economic History Review, Economic History Society, vol. 38(3), pages 402-422, 08.
- Rajan, Raghuram G & Zingales, Luigi, 1998.
"Financial Dependence and Growth,"
American Economic Review,
American Economic Association, vol. 88(3), pages 559-86, June.
- Raghuram G. Rajan & Luigi Zingales, . "Financial Dependence and Growth," CRSP working papers 344, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
- Raghuram G. Rajan & Luigi Zingales, 1996. "Financial Dependence and Growth," NBER Working Papers 5758, National Bureau of Economic Research, Inc.
- Fama, Eugene F. & French, Kenneth R., 2004. "New lists: Fundamentals and survival rates," Journal of Financial Economics, Elsevier, vol. 73(2), pages 229-269, August.
- Corbett, Jenny & Jenkinson, Tim, 1997. "How Is Investment Financed? A Study of Germany, Japan, the United Kingdom and the United States," The Manchester School of Economic & Social Studies, University of Manchester, vol. 65(0), pages 69-93, Supplemen.
This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.
When requesting a correction, please mention this item's handle: RePEc:oxf:wpaper:377. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Caroline Wise)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.