This paper surveys 4 major capital structure theories: trade-off, pecking order, signaling and market timing. For each theory, a basic model and its major implications are presented. These implications are compared to the available evidence. This is followed by an overview of pros and cons for...

We analyze the financing decisions and capital structure of internet companies and relate observed findings to the common capital structure theories. Large internet companies usually have low debt and small internet companies have high debt. We find that the trade-off theory of capital...

The correlation analysis was conducted on dynamic of GDP and company failure rate for Poland, Europe and USA for the period 2003-2011; it was found a negative correlation. An analysis was undertaken for the relation between the rate of corporate failure in Poland and the rate of change of overall...

The paper presents the approach for the verification of the lemma used for the model for reputation risk for subsidiaries of non-public group with reciprocal shareholding as proposed by the author in priory works. For all entities with the absolute value of the reputation risk greater than the...

According to Graham and Harvey (2001), an immense gap exists between capital structure theories and practice. By analyzing students’ perception of capital structure theories and the differences between their opinion and that of the current CEO’s and managers this paper argues that this can...

The article presents the initial proposal for the group risk measurement based on the comparison of two interconnected sets of webs. The risk scalar has been presented both for each separated subsidiary as well as for the group itself. It was shown the risk profile of the group could be...

Author challenges one of the oldest accounting double bookkeeping rules, used since 1494, and proposes instead application of the quadruple accounting entry. He presents the concept of the multiply accounting entry for the risk financial statements and risk management. The development gap...

The literature analyzing games where some players have private information about their "types" is usually based on the duality of "good" and "bad" types (GB approach), where "good" type denotes the type with better quality. In contrast, this paper analyzes a signalling game without types...

This paper analyzes debt-equity choice for financing a two-stage investment when a firm’s insiders have private information about the firm’s expected earnings. When private information is one-dimensional (for example when short-term earnings are common knowledge while long-term earnings are...

We build a model of an IPO for firms with private information about their earnings profile over time and test the model’s predictions using a complete sample of newly listed Chinese companies between 1992 and 2007. The model predicts that IPO size is positively correlated with short-term...