Internal vs External Financing of Acquisitions: Do Managers Squander Retained Profits?
研究收购融资来源对盈利性的影响，发现外部融资收购的负面效应更大，不支持管理者浪费内部资金的假设。
It is often argued that managers who have control over investment finance are more likely to pursue their own goals while those who have to raise funds externally are effectively monitored by the financial markets. One implication is that externally finances investment should be more profitable than internally financed investment. We focus on investment in acquisitions and show that its negative net impact on profitability (as seen in previous studies) derives from externally, rather than internally, financed acquisitions. Our results therefore do not support the hypothesis that managers squander internal funds on poor investment projects. Indeed, the evidence suggests that capital markets and financial institutions do not appear to generate the anticipated beneficial effects.