【报告主题】Customer Base Concentration, Investment efficiency, and Growth Options
【主讲嘉宾】张国昌，香港大学，会计学教授
【报告时间】2023年5月29日 14:00
【报告地点】会计学院108室
【内容提要】We hypothesize that customer base concentration (CC) is a source of operational inflexibility that impedes firms’ capital investment and thus reduces their ability to exploit real options. Supporting this hypothesis, we empirically document a negative relation between CC and the responsiveness of capital investment to profitability signals. This result holds both in cross sectional samples and from using two plausibly exogenous shocks to CC (customer CEO turnover and import tariff reductions in customer industries). The documented effect is stronger when firms have low bargaining power vis-à-vis their customers, while it is muted where firms’ major customers are governments (which are likely to be less opportunistic). Along with reduced investment responsiveness, firm value as a function of profitability becomes less convex, suggesting that CC hinders the ability to utilize growth options. Finally, the effects of CC are stronger in industries of high (versus low) capital asset reusability, suggesting that inflexibilities stemming from sales and production activities have substantive effects.