A Theory Of The Financialized Firm

With Keir Martin

The recent events at BHS demonstrate how owners use complex firm structures, intercompany debt and limited liability privileges to avoid tax, pay special dividends and limit owner obligations. These financialized practices are now commonplace across much of the corporate sector (see Bowman et al 2015), raising important questions about the contemporary social and economic purpose of the firm.

A Network For Lemons?: Challenges To Financial Resilience In The Post-Crisis Collateralised Loan Obligation (CLO) Market

Collateralized Loan Obligations (CLOs) are securitized structured credit derivatives backed by risky corporate loans. They share features with the Collateralized Debt Obligations (CDOs) that blew up the financial system in 2007/8. By the end of 2018, the outstanding value of CLOs reached $616bn (SIFMA 2018) – an amount roughly equivalent to the CDO market in 2006. This has raised concern about the capacity for CLOs – and the corporate loan markets they shape – to cause another financial crisis (Bank of England 2018; Federal Reserve 2019)