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Full-Text Articles in Finance and Financial Management
Financial Constraints, The Distribution Of Wealth And International Trade, Emmanuel Amissah, Spiros Bougheas, Rodney Falvey
Financial Constraints, The Distribution Of Wealth And International Trade, Emmanuel Amissah, Spiros Bougheas, Rodney Falvey
Rodney Falvey
Extract:
As the Heckscher-Ohlin-Mundell paradigm predicts, in a world where capital markets are perfect and production exhibits constant-returns to scale, while aggregate wealth endowments can be an important source of comparative advantage, their internal distribution does not matter for the patterns of international trade. This is because in the absence of financial frictions the only factor that determines the availability of external finance is a project's net present value. In real life financial markets are far from perfect. Informational asymmetries between lenders and borrowers, corporate governance quality shortcomings and non-negligible intermediation costs are only a sample of the types of …
Spread Decomposition With Common Spread Components, Thomas Henker
Spread Decomposition With Common Spread Components, Thomas Henker
Thomas Henker
Purpose – This paper aims to incorporate a market wide buying and selling pressure cost component into a spread decomposition model as spread cost component.
Design/methodology/approach – The paper extends a commonly used trade indicator spread decomposition model to include a component common to all stocks of a specialist firm and a market wide component common to all stocks.
Findings – Strong evidence is found that specialists consider this common factor cost component when they set bid and ask quotes. Some specialist firms also take the next logical step and specifically manage their firm wide stock inventories. The common factor …