《《Access to capital》.pdf

Access to capital, investment, and the financial crisis Kathleen M. Kahle and René M. Stulz* September 2012   * Respectively, associate professor, Eller College of Management, University of Arizona, and Everett D. Reese Chair of Banking and Monetary Economics, Fisher College of Business, Ohio State University, NBER, and ECGI. We thank Christian Leuz, Cathy Schrand, Berk Sensoy, and Mike Weisbach for useful discussions; Viral Acharya, Rudi Fahlenbrach, Jarrad Harford, Jean Helwege, Vince Intintoli, Darius Palia, Francisco Perez-Gonzalez, Robert Prilmeier, David Scharfstein, Andrei Shleifer, and participants at the Fall 2010 Corporate Finance meeting of the NBER, the 2010 AFE meetings in Denver, and at seminars at Arizona State University, Boston College, the Federal Reserve Board, Harvard University, Ohio State University, Rutgers University, the University of Amsterdam, the University of Rotterdam, and the University of Tilburg for useful comments. We are also grateful to Jia Chen, Yeejin Jang, Robert Prilmeier, and Matt Wynter for excellent research assistance. We are especially indebted to Harry DeAngelo for discussions and detailed comments. Access to capital, investment, and the financial crisis Abstract During the financial crisis, corporate borrowing and capital expenditures fall sharply. Most existing research links the two phenomena by arguing that a shock to bank lending (or more generally to the corporate credit supply) caused a reduction in capital expenditures. The economic significance