01610cas a2200265 a 4500 AALejournalIMF000748 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451857641 1018-5941 BD-DhAAL BD-DhAAL Razin, Assaf. Capital Flows with Debt- and Equity-Financed Investment-Equilibrium Structure and Efficiency Implications / Assaf Razin, Chi-Wa Yuen, Efraim Sadka. Washington, D.C. : International Monetary Fund, 1998. 1 online resource (21 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper distinguishes between debt and equity flows in the presence of information asymmetry between the firm's 'insiders' and 'outsiders' in a small open economy. It shows the inadequacy of capital investment because its scope is too narrow and the investment each firm makes is too little. An unconventional policy tool is proposed to correct the market failure: lump-sum subsidies to firms that choose to equity-finance their investments. Mode of access: Internet Sadka, Efraim. Yuen, Chi-Wa. IMF Working Papers; Working Paper ; No. 1998/159 Full text available on IMF http://elibrary.imf.org/view/journals/001/1998/159/001.1998.issue-159-en.xml IMF e-Library