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Yen-Chen Chiu
''Industry Concentration and Cash Flow at Risk''
( 2010, Vol. 30 No.1 )
This paper explores the link between industry concentration, which is a feature of the product markets in which firms operate, and the risk of a firm's cash flows, offering the first empirical evidence of the risky cash-flow implications of industry market structure. Our analysis shows that on average highly concentrated industries have experienced lower volatility of cash flows while the volatility of cash flows for competitive industries is higher. Our findings are consistent with the view that innovation and distress risk, which is more pronounced in competitive industries, are prized sources of risk in the context of the cash-flow-at-risk.
Keywords: Cash-flow-at-risk, Industry Concentration
JEL: C1 - Econometric and Statistical Methods: General
C5 - Econometric Modeling: General
Manuscript Received : Jun 05 2009 Manuscript Accepted : Jan 29 2010

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