Detail Theoretical and empirical issues in capital structure Bibliografi Author: Wald, John Krzysztof ; Romer, David H. (Advisor) Topik: ECONOMICS; FINANCE|BUSINESS ADMINISTRATION; BANKING Bahasa: (EN )    ISBN: 0-591-09747-8     Penerbit: University of California Press     Tahun Terbit: 1996     Jenis: Theses - Dissertation Fulltext: 9703305.pdf (0.0B; 7 download) Abstract This thesis consists of three chapters addressing different aspects of firms' capital structure. The first chapter develops a symmetric information model of a new firm which incorporates a constraint on dividend payments known as a balance sheet test. This test dictates that dividend payments for a new firm can come only from earnings, and not from issued debt. This rule is designed to solve moral hazard problems that arise in credit markets where complete contracting over future actions is not possible. This constraint breaks down the traditional symmetric information result of separability between financial and real variables, and thus maximizing shareholder returns in this setting is not equivalent to maximizing firm value. As a consequence, equity values are always positive, and the average product of capital is an important determinant of capital structure. Computer simulations of this model predict debt/equity ratios that are consistent with those observed in American firms. The second chapter examines the determinants of firms' capital structures in the U.S. and four other countries. A number of theories are tested against these empirical results. Comparing capital decision factors across countries, many differences appear in the correlation between debt/asset ratios and the firms' riskiness, profitability, size, and growth. These correlations can be explained by differences in tax policies and agency problems, including differences in bankruptcy costs, information asymmetries, and shareholder/creditor conflicts. The chapter attempts to link these agency problems to legal and institutional differences across countries. The third chapter attempts to determine whether asymmetric information or bankruptcy costs more significantly affects firm investment. While proxies for asymmetric information do not affect the earnings/investment relationship, bankruptcy risk is significantly correlated with investment, suggesting that bankruptcy costs create liquidity constraints. This relationship appears to be stable over measures of bankruptcy risk and estimation method. Moreover, the basic relationship between cash flows and investment is insignificant when using an instrumental variable approach, suggesting that it may be due to unobserved correlations rather than asymmetric information. Opini Anda Klik untuk menuliskan opini Anda tentang koleksi ini! Lihat Sejarah Pengadaan  Konversi Metadata   Kembali

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