Extensive Margin Adjustment of Multi-Product Firm and Risk Diversification. /
| Yazar: | |
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| Materyal Türü: | Licensed eBooks |
| Dil: | İngilizce |
| Baskı/Yayın Bilgisi: |
[Washington, D.C.] :
International Monetary Fund,
[2017]
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| Seri Bilgileri: | IMF working paper ;
WP/17/146. |
| Online Erişim: | https://search.ebscohost.com/login.aspx?direct=true&scope=site&db=nlebk&AN=1555981 |
| Özet: | Product scope adjustment is a key mechanism through which multi-product firms achieve efficient resource allocations. In this paper, we take a novel perspective to study firms' product scope adjustment behavior through the lens of asset pricing. Using a unique panel scanner data set containing detailed information on products, matched with the financial information of their manufacturers, we find that multi-product firms with higher product turnover have lower financial risks and lower risk premia. To understand this channel, we propose a stylized model with a time-dependent (Calvo-type) product turnover rate to highlight the 'risk absorption channel' of product scope adjustment. In response to an economy-wide shock, a firm that can adjust its product scope more flexibly shows lower excess equity returns and lower asset volatility. |
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| Fiziksel Özellikler: | 1 online resource (44 pages) |
| ISBN: | 1484303768 9781484303764 1484307046 9781484307045 |