Abstract

http://ssrn.com/abstract=898066
 
 

References (67)



 
 

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Financing Firms in India


Franklin Allen


University of Pennsylvania - Finance Department; European Corporate Governance Institute (ECGI)

Rajesh Chakrabarti


Indian School of Business (ISB)

Sankar De


Independent

Jun Qian


Shanghai Advanced Institute of Finance(SAIF), Shanghai Jiao Tong University; University of Pennsylvania - Wharton Financial Institutions Center; China Academy of Financial Research (CAFR)

Meijun Qian


National University of Singapore

April 11, 2009

EFA 2006 Zurich Meetings

Abstract:     
With extensive cross-country datasets and India firm samples, as well as our own surveys of small and medium firms, we examine the legal and business environments, financing channels, and growth patterns of different types of firms in India. Despite the English common-law origin and a British-style judicial system, Indian firms face weak investor protection in practice and poor institutions characterized by corruption and inefficiency. Alternative finance, including financing from all non-bank, non-market sources, and generally backed by non-legal mechanisms, constitutes the most important form of external finance. Bank loans provide the second most important external financing source. Firms with access to bank or market finance are not associated with higher growth rates. Our results indicate that bank and market finance is not superior to alternative finance in fast-growing economies such as India.

Number of Pages in PDF File: 63

Keywords: India, banks, markets, alternative finance, growth

JEL Classification: O5, K0, G0

working papers series


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Date posted: June 30, 2006 ; Last revised: December 5, 2011

Suggested Citation

Allen, Franklin and Chakrabarti, Rajesh and De, Sankar and Qian, Jun and Qian, Meijun, Financing Firms in India (April 11, 2009). EFA 2006 Zurich Meetings. Available at SSRN: http://ssrn.com/abstract=898066 or http://dx.doi.org/10.2139/ssrn.898066

Contact Information

Franklin Allen (Contact Author)
University of Pennsylvania - Finance Department ( email )
The Wharton School
3620 Locust Walk
Philadelphia, PA 19104
United States
215-898-3629 (Phone)
215-573-2207 (Fax)
HOME PAGE: http://finance.wharton.upenn.edu/~allenf/

European Corporate Governance Institute (ECGI)
c/o ECARES ULB CP 114
B-1050 Brussels
Belgium
HOME PAGE: http://www.ecgi.org
Rajesh Chakrabarti
Indian School of Business (ISB) ( email )
Hyderabad, Gachibowli 500 019
India
91-40-2318-7167 (Phone)
91-40-2300-7032 (Fax)
HOME PAGE: http://www.isb.edu/faculty/RajeshChakrabarti/

Sankar De
Independent ( email )
No Address Available
Jun Qian
Shanghai Advanced Institute of Finance(SAIF), Shanghai Jiao Tong University ( email )
211 West Huaihai Road
Shanghai, 200030
China
86-21-62934520 (Phone)
86-21-62934572 (Fax)
HOME PAGE: http://www.saif.sjtu.edu.cn/en/professors/2101
University of Pennsylvania - Wharton Financial Institutions Center
2306 Steinberg Hall-Dietrich Hall
Philadelphia, PA 19104
United States
HOME PAGE: http://fic.wharton.upenn.edu/fic/
China Academy of Financial Research (CAFR)
1954 Huashan Road
Shanghai P.R.China, 200030
China

Meijun Qian
National University of Singapore ( email )
1 Business Link
Singapore, 117592
Singapore
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