Corporate Finance and Financial Development: An Emerging Market Perspective on a Post-Crisis World

This book explores corporate finance in emerging markets, focusing on financial development and stability. It highlights the impact of interdependence, crises, and the post-crisis world on companies and policies.

Format: Hardback
Length: 212 pages
Publication date: 09 July 2022
Publisher: Springer International Publishing AG

This comprehensive book delves into critical aspects of corporate finance, offering a comprehensive exploration from both the perspectives of financial development and financial stability in emerging markets. Emerging economies face the unique challenge of rapidly evolving financial sectors and products, as well as the potential for financial upheavals. In this context, the increasing interconnectedness of states and capital markets, coupled with the risk of crises, exerts a significant influence on the financing of firms. The chapters within this book shed light on the impact of these factors on companies and policies in emerging markets, while also addressing the challenges posed by the current post-crisis world. By seamlessly blending academic expertise with industry insights, this book provides a thorough examination of the critical issues in corporate finance, financial development, and the preparedness of emerging markets.

Emerging economies are characterized by their rapid economic growth, which often attracts foreign investment and drives economic development. However, these economies also face unique challenges, such as political instability, corruption, and limited infrastructure. As a result, companies operating in emerging markets may face higher risks and require different financing strategies than those in developed markets.

One of the key issues in corporate finance in emerging markets is the lack of access to capital. Many companies in emerging markets are small and medium-sized enterprises (SMEs), which often struggle to secure financing from traditional banks. This can be due to a variety of factors, such as a lack of collateral, poor credit history, and limited market knowledge.

To address this issue, many companies in emerging markets turn to alternative financing sources, such as venture capital, private equity, and microfinance institutions. These institutions provide financing to SMEs and other companies that may not have access to traditional banking services. However, these financing sources can also be more risky and may require companies to give up a significant portion of their ownership.

Another issue in corporate finance in emerging markets is the lack of financial infrastructure. Many emerging economies lack modern financial systems, such as credit bureaus, stock exchanges, and payment systems. This can make it difficult for companies to access capital and conduct financial transactions. In addition, the lack of financial infrastructure can also make it difficult for investors to monitor and evaluate the risks associated with investing in emerging markets.

To address this issue, many governments and international organizations are investing in financial infrastructure development in emerging markets. This can include the establishment of new financial institutions, the development of new financial products, and the promotion of financial literacy and education.

In conclusion, corporate finance in emerging markets is a complex and challenging field that requires a comprehensive understanding of the unique financial and economic challenges faced by these economies. By combining academic and industry insights, companies and policymakers can develop effective strategies for financing and managing risk in emerging markets.

Weight: 506g
Dimension: 235 x 155 (mm)
ISBN-13: 9783031049798
Edition number: 1st ed. 2022