Local banking development and the use of debt financing by new firms

This is the author accepted manuscript. The final version is available from the publisher via the DOI in this recordWe investigate the effects of local banking development on the debt financing of new firms using a large sample of Italian firms. Controlling for potential endogeneity issues, we find that new firms are more likely to use bank debt and have higher leverage in provinces with more bank branches relative to population. However, it is important to account for bank heterogeneity. For instance, more foreign banks in a province actually reduce access to bank debt. Taken together, our study provides new and nuanced evidence on the role of local banking development for the debt financing of new firms

The evolution of debt policies: New evidence from business startups

This is the author accepted manuscript. The final version is available from the publisher via the DOI in this recordWe investigate the evolution of entrepreneurial firms' debt policies over a period of 15 years after startup, considering leverage, debt specialization, debt maturity and debt granularity. Our analysis is based on a unique sample covering all non-financial Belgian firms founded between 1996 and 1998. We find that the debt policy of entrepreneurial firms is remarkably stable over time. The debt policy in the initial year of operation is a very important determinant of future debt policies, even after controlling for traditional contemporaneous determinants. The founder-CEO has an important impact on the stability of debt policies: the influence of initial debt policies on future debt policies is significantly reduced when the founder-CEO is replaced or when (s)he dies. Combined, our findings support imprinting theory.Hercules FundNational Bank of BelgiumGhent University Special Research Fun

The valuation of IPOs by investment banks and the stock market: empirical evidence.

In this paper, pre-IPO value estimations by the lead underwriting investment bank of Belgian IPO stocks are compared to the offer price and the stock price in the first month of listing. The valuation methods used by the lead underwriter and the estimated values are often discussed in Belgian IPO-prospectuses. For 33 IPOs in the 1993-2000 period, we find that in all cases the lead underwriter uses several methods to estimate stock value. Discounted free cash flow, which is used to price all IPOs in the sample, is the most popular valuation method. The IPO offer price is mainly driven by the dividend discount model if applied. However, we find that the dividend discount model is not better in predicting the stock price than other valuation models. Moreover, our results suggest that the dividend discount model tends to underestimate value, while discounted free cash flow produces unbiased results. This indicates that underwriters consciously underprice the IPO by relying on a valuation method that tends to underestimate value. We also find that price/earnings and price/cash flow multiples using forecasted earnings and cash flows for the year after the IPO lead to more accurate valuations than multiples using forecasted earnings and cash flows for the IPO-year. Finally, our results indicate that the offer price is closer to the stock price after listing than individual valuation estimates, although the differences are not statistically significant

Unemployment insurance and cash holdings of privately-held firms around the world

This is the author accepted manuscript . The final version is available from Wiley via the DOI in this recordResearch Question/Issue: This paper studies the relationship between country-level unemployment insurance and cash holdings of privately-held firms. When public unemployment insurance is weak, firms may provide alternative unemployment insurance by committing not to lay off workers in bad times. We hypothesize that one way firms can do so is by holding larger cash balances. Research Findings/Insights: Using a large sample covering 388,940 private firms from 32 countries around the world over the 2007-2014 period, we find a negative relationship between public unemployment insurance and cash holdings. This effect is driven by countries where public unemployment insurance is weak or non-existent. We also find that privately-held firms keep a larger part of their new debt issues as cash when public unemployment insurance is weak. Theoretical/Academic Implications: We contribute to a growing literature on an institution-based view of comparative corporate governance. We show that national governance factors and, more specifically, public unemployment insurance, which protects employees (an important butrelatively ignored stakeholder), influences firm cash holdings in a private firm context. Practitioner/Policy Implications: Our findings have important implications for policy design. Specifically, they suggest that labor market institutions designed to support employees can also indirectly benefit their employers because these institutions allow firms to reduce the opportunity cost related to holding larger cash balances

Desflurane consumption during automated closed-circuit delivery is higher than when a conventional anesthesia machine is used with a simple vaporizer-O2-N2O fresh gas flow sequence

The Zeus® (Dräger, Lübeck, Germany), an automated closed-circuit anesthesia machine, uses high fresh gas flows (FGF) to wash-in the circuit and the lungs, and intermittently flushes the system to remove unwanted N₂. We hypothesized this could increase desflurane consumption to such an extent that agent consumption might become higher than with a conventional anesthesia machine (Anesthesia Delivery Unit [ADU®], GE, Helsinki, Finland) used with a previously derived desflurane-O₂-N₂O administration schedule that allows early FGF reduction.Journal ArticleSCOPUS: ar.jinfo:eu-repo/semantics/publishe

Relocation to get venture capital : a resource dependence perspective

This is the author accepted manuscript. The final version is available from SAGE via the DOI in this record.Using a resource dependence perspective, we theorize and show that non-venture-capital-backed ventures founded in U.S. states with a lower availability of venture capital (VC) are more likely to relocate to California (CA) or Massachusetts (MA)—the two VC richest states—compared to ventures founded in states with a greater availability of VC. Moreover, controlling for self-selection, ventures that relocate to CA or MA subsequently have a greater probability of attracting initial VC compared to ventures that stay in their home state. We discuss the implications for theory, future research, and practice

Deciphering Proteomic Signatures of Early Diapause in Nasonia

Insect diapause is an alternative life-history strategy used to increase longevity and survival in harsh environmental conditions. Even though some aspects of diapause are well investigated, broader scale studies that elucidate the global metabolic adjustments required for this remarkable trait, are rare. In order to better understand the metabolic changes during early insect diapause, we used a shotgun proteomics approach on early diapausing and non-diapausing larvae of the recently sequenced hymenopteran model organism Nasonia vitripennis. Our results deliver insights into the molecular underpinnings of diapause in Nasonia and corroborate previously reported diapause-associated features for invertebrates, such as a diapause-dependent abundance change for heat shock and storage proteins. Furthermore, we observed a diapause-dependent switch in enzymes involved in glycerol synthesis and a vastly changed capacity for protein synthesis and degradation. The abundance of structural proteins and proteins involved in protein synthesis decreased with increasing diapause duration, while the abundance of proteins likely involved in diapause maintenance (e.g. ferritins) increased. Only few potentially diapause-specific proteins were identified suggesting that diapause in Nasonia relies to a large extent on a modulation of pre-existing pathways. Studying a diapause syndrome on a proteomic level rather than isolated pathways or physiological networks, has proven to be an efficient and successful avenue to understand molecular mechanisms involved in diapause

The Interest Rate and Credit Channels in Belgium: An Investigation with Micro-Level Firm Data

This paper investigates the effects of monetary policy on firms' investment behaviour. The analysis relies on a comprehensive database of Belgian firms covering all sectors of economic activity and firms of all sizes. We proceed in two steps. First, we estimate a reduced-form investment equation derived from the neo-classical model, augmented by cash flow. This equation is estimated by the Arellano and Bond (1991) GMM procedure. Second, we compute the elasticity of the user cost of capital and the cash flow/capital ratio to the policy-controlled interest rate. We estimate the model for various sample splits according to sectors and sizes. Our results indicate that small firms are more sensitive to monetary policy than large firms, and that services are almost unaffected. Since the impact differs across sectors and sizes, we can conclude that monetary policy produces distributional effects