The Financing and Growth of Firms in China and India : Evidence from Capital Markets

This paper studies the extent to which firms in China and India use capital markets to obtain financing and grow. Using a unique data set on domestic and international capital raising activity and firm performance, it finds that the expansion of financial market activity since the 1990s has been more limited than what the aggregate figures suggest. Relatively few firms raise capital. Even fewer firms capture the bulk of the financing. Moreover, firms that issue equity or bonds are different and behave differently from other publicly listed firms. Among other things, they are typically larger and grow faster. The differences between users and non-users exist before the capital raising activity, are associated with the probability of raising capital, and become more accentuated afterward. The distribution of issuing firms shifts more over time than the distribution of those that do not issue, suggesting little convergence in firm size among listed firms.

Bibliographic Details

Main Authors:	Didier, Tatiana, Schmukler, Sergio L.
Language:	English en_US
Published:	World Bank, Washington, DC 2013-04
Subjects:	ACCESS TO CAPITAL, ACCESS TO FINANCE, ACCOUNTING, ACCOUNTING STANDARDS, ADB, AGRICULTURE, AMOUNT OF CAPITAL, ASIAN BOND MARKETS, BALANCE SHEET, BANK ASSETS, BANK FINANCING, BANK FOR INTERNATIONAL SETTLEMENTS, BANK POLICY, BANKING SECTOR, BANKING SYSTEM, BENCHMARK, BOND, BOND FINANCING, BOND ISSUANCE, BOND MARKET, BOND MARKET CAPITALIZATION, BOND MARKETS, BONDS, BROKERS, BUSINESS OPPORTUNITIES, CAPITAL EXPENDITURES, CAPITAL MARKET, CAPITAL MARKET ACTIVITY, CAPITAL MARKET DEVELOPMENT, CAPITAL MARKET FINANCING, CAPITAL MARKETS, CAPITAL RAISING, CAPITAL STRUCTURE, CASH FLOWS, COMMERCIAL PAPER, COMPANY, COMPARATIVE ECONOMICS, CONSUMER PRICE INDEX, CORPORATE BOND, CORPORATE BOND ISSUES, CORPORATE BOND MARKETS, CORPORATE FINANCING, CORPORATE VALUATION, CORPORATION, CORPORATIONS, COST OF CAPITAL, DEBT, DEBT ISSUES, DEREGULATION, DEVELOPMENT ECONOMICS, DEVELOPMENT POLICY, DOMESTIC BOND, DOMESTIC BOND MARKET, DOMESTIC BOND MARKETS, DOMESTIC EQUITY, DOMESTIC MARKET, DOMESTIC MARKETS, DUMMY VARIABLE, DUMMY VARIABLES, EARNINGS, ECONOMIC ACTIVITY, ECONOMIC DEVELOPMENT, ECONOMIC GROWTH, ECONOMIC LIBERALIZATION, EMERGING ECONOMIES, EMERGING STOCK MARKET, EMPLOYEE, EQUALITY, EQUITIES, EQUITY CAPITAL, EQUITY FINANCING, EQUITY ISSUANCE, EQUITY ISSUES, EQUITY MARKET, EQUITY MARKET CAPITALIZATION, EQUITY MARKETS, EQUITY SECURITIES, EVOLUTIONARY ECONOMICS, EXCHANGE RATE, EXCLUSION, EXPANSION, EXPENDITURE, EXPENDITURES, EXTERNAL CAPITAL, FEDERAL RESERVE, FEDERAL RESERVE BANK, FINANCIAL ASSETS, FINANCIAL CHALLENGES, FINANCIAL CRISIS, FINANCIAL DEEPENING, FINANCIAL DEVELOPMENT, FINANCIAL GLOBALIZATION, FINANCIAL HEALTH, FINANCIAL INSTITUTIONS, FINANCIAL INTERMEDIARIES, FINANCIAL INTERMEDIATION, FINANCIAL LIBERALIZATION, FINANCIAL MARKET, FINANCIAL MARKETS, FINANCIAL PERFORMANCE, FINANCIAL SECTOR, FINANCIAL SECTOR DEVELOPMENT, FINANCIAL SERVICES, FINANCIAL STRUCTURE, FINANCIAL STUDIES, FINANCIAL SYSTEM, FINANCIAL SYSTEMS, FINANCING OBSTACLES, FIRM PERFORMANCE, FIRM SIZE, FIRM SIZES, FIRMS, FIXED CAPITAL, FOREIGN CAPITAL, FOREIGN EQUITY, FOREIGN FINANCING, FOREIGN INVESTORS, FOREIGN MARKET, FOREIGN MARKETS, GDP, GLOBAL FINANCE, GLOBALIZATION, GREATER ACCESS, GROUP OF FIRMS, GROWTH OPPORTUNITIES, GROWTH RATE, INFLATION, INFORMAL FINANCE, INITIAL PUBLIC OFFERING, INSTITUTIONAL DEVELOPMENT, INSTITUTIONAL INVESTORS, INSURANCE, INSURANCE COMPANIES, INTERNAL FINANCE, INTERNAL FINANCING, INTERNATIONAL BANK, INTERNATIONAL CAPITAL, INTERNATIONAL COMMERCE, INTERNATIONAL DIVERSIFICATION, INTERNATIONAL ECONOMICS, INTERNATIONAL FINANCIAL INTEGRATION, INTERNATIONAL MARKETS, INTERNATIONAL SETTLEMENTS, INTERNATIONAL TRADE, INVENTORIES, INVESTMENT BANKS, INVESTMENT CAPITAL, INVESTMENT OPPORTUNITIES, IPO, ISSUANCES, KEY PERFORMANCE INDICATORS, LEGAL CONSTRAINTS, LIABILITY, LIQUIDITY, LIQUIDITY CONSTRAINTS, LISTED COMPANIES, LOCAL MARKETS, LONG-TERM LIABILITIES, MACROECONOMICS, MARKET CONDITIONS, MARKET DEPTH, MARKET REFORMS, MATURITY, MATURITY STRUCTURE, MERCHANTS, MERGERS, MUTUAL FUNDS, OPEN ECONOMIES, OWNERSHIP STRUCTURE, PENSION, PENSION FUNDS, POLITICAL ECONOMY, PORTFOLIO, PORTFOLIO HOLDINGS, PRIVATE BOND, PRODUCTIVITY, PROFITABILITY, PUBLIC SECTOR BONDS, REAL ESTATE, RECEIPT, RETAINED EARNINGS, RETURN, RETURN ON ASSETS, SALES GROWTH, SAVINGS, SECONDARY MARKET, SECONDARY MARKET ACTIVITY, SECURITIES, SECURITIES MARKETS, SIDE EFFECTS, SMALL FIRMS, STOCK EXCHANGES, STOCK MARKET, STOCK MARKET CAPITALIZATION, STOCK MARKETS, SUBSIDIARIES, TRADE CREDIT, TRADING, TRANSACTION, VALUATION, WTO,
Online Access:	http://documents.worldbank.org/curated/en/2013/04/17548887/financing-growth-firms-china-india-evidence-capital-markets https://hdl.handle.net/10986/13198
Tags:	Add Tag No Tags, Be the first to tag this record!