Exchange Rates and Corporate Performance

A series of incisive, analytical essays on the causes and consequences of management buyouts by financial economists, lawyers, dealmakers, and principal policymakers.

This well-documented book contains the proceedings of a conference on the effect of exchange rates on corporations. Sponsored by the Salomon Center, Stern School of Business of New York University, it was held at NYU in 1992. The idea for the conference arose out of the volatility of the exchange rate in the 1980s, which changed the way international firms operated and had a profound effect on their financial policies. The issues are presented in three major categories: exchange rates and the macroeconomic environment; exchange rate volatility and capital markets; and exchange rates and corporate strategic management.

... Numerous graphs and tables support the empirical data. Since changes in exchange rates affect many companies in fundamental ways, tse papers will provide historical analysis of the pitfalls and give insight into what might be done to combat them.

The proceedings of a May 1992 conference at New York University exploring how volatile fluctuations in exchange rates affect corporations. The 11 papers discuss the effects on the macroeconomic environment, the cost of capital, corporate strategic management, pricing policies, sources, markets, and relocation. Annotation copyright Book News, Inc. Portland, Or.

Yakov Amihud is Ira Leon Rennert Professor of Entrepreneurial Finance of the Stern School of Business, New York University where he has been teaching since 1990, and concurrent holds a research professorship in Finance. He obtained his Bachelor of Social Science degree from Hebrew University (1969); Master of Science in Business Administration from New York University Graduate School of Business Administration (1973) and his Doctor of Philosophy in Business Administration from the same institution in 1975.

Richard M. Levich is Professor of Finance and International Business at New York University's Leonard N. Stern School of Business. He is also a Research Associate with the National Bureau of Economic Research in Cambridge, Massachusetts. He currently serves as Editor of The Journal of International Financial Management and Accounting. Professor Levich has been a visiting faculty member at many distinguished universities in the United States and abroad. He has lectured in many executive education programs and has been a consultant or visiting scholar at the Federal Reserve Board of Governors, the International Monetary Fund and the World Bank. He has published more than fifty articles on various topics dealing with international finance, and is the author or editor of thirteen books. Professor Levich received his Ph.D. from the University of Chicago.

1.	Introduction	1
	Yakov Amihud Richard M. Levich
Part One: Exchange Rates, the Macroeconomic Environment and the Firm
2.	Exchange Rates and the Economy	15
	Rudiger Dornbusch
3.	Exchange Rates and the Valuation of Firms	37
	Maurice D. Levi
4.	Exchange Rates and the Valuation of Equity Shares	49
	Yakov Amihud
	Comment	61
	Robert E. Cumby
	Comment
	Brian C. Genbeau
Part Two: Exchange Rate Volatility and Capital Markets
5.	Exchange Rate Volatility and Equity Returns	75
	Stephen J. Brown Toshiyuki Otsuki
6.	Exchange Rates and Long-Term Interest Rates	97
	Philippe Jorion
7.	Exchange Rates and International Differences in the Cost of Capital	119
	Robert N. McCauley Steven A. Zimmer
	Comment	149
	James N. Bodurtha, Jr.
	Comment	155
	Ian Giddy
Part Three: Exchange Rates and Corporate Strategic Management
8.	Exchange Rate Planning for the International Trading Firm	165
	Michael Adler
9.	Exchange Rates and Corporate Pricing Strategies	181
	Michael M. Knetter
10.	Managing Economic Exposure to Foreign Exchange Risk: A Case Study of American Airlines	221
	John F.O. Bilson
11.	Strategic Management of Foreign Exchange Exposure in an International Firm	247
	Maricia B. Whitaker
	Comment	253
	Kenneth A. Frooi