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| HAL : halshs-00365983, version 1 |
| DOI : 10.1016/j.jcorpfin.2008.03.001 |
| Fiche détaillée |  Export this paper |
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| Journal of Corporate Finance Vol. 14, Issue 4 (2008) pp 337-346 |
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| Access to financing, rents, and organization of the firm |
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| Antoine Renucci 1 |
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| (2008-09-01) |
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| This paper provides a theory for the choice of an organizational structure by the headquarters of a unitary structure concerned about overload. The headquarters can avoid overload by delegating operational decisions to divisions, i.e., moving the firm to a multidivisional structure. We show that, under moral hazard, these divisions receive rents for incentive purposes, and that the multidivisional structure is able to invest more. Thus, there is a trade-off between increasing investment and paying rents. We also show that this trade-off applies to situations where firms consider engaging in acquisitions and joint ventures, or where entrepreneurs consider resorting to venture capitalists. |
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| 1 : | Dauphine Recherches en Management (DRM) |
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CNRS : UMR7088 – Université Paris IX - Paris Dauphine |
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| DRM UMR7088 CNRS - Equipe du CEREG |
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| Discipline | : | Humanities and Social Sciences/Business administration |
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| Unitary-form – Multidivisional-form – Agency rents – Credit rationing |
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| Liste des fichiers attachés à ce document : | |||||
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| halshs-00365983, version 1 | |
| http://halshs.archives-ouvertes.fr/halshs-00365983 | |
| oai:halshs.archives-ouvertes.fr:halshs-00365983 | |
| Contributeur : Salem Tacine | |
| Submitted on : Thursday, 5 March 2009 12:13:33 | |
| Updated on : Friday, 6 March 2009 10:33:53 | |
