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Maturity Rationing and Collective Short-Termism
Milbradt, Konstantin; Oehmke, Martin - National Bureau of Economic Research (NBER) - 2014
Financing terms and investment decisions are jointly determined. This interdependence links firms' asset and liability sides and can lead to short-termism in investment. In our model, financing frictions increase with the investment horizon, such that financing for long-term projects is...
Persistent link: https://www.econbiz.de/10010969405
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Financing Decisions and Product Introductions of Private and Publicly Traded Firms
Phillips, Gordon M.; Sertsios, Giorgo - National Bureau of Economic Research (NBER) - 2014
lower price risk. …
Persistent link: https://www.econbiz.de/10010950886
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Outside Purchase Contracts, Human Capital and Firm Capital Structure
Phillips, Gordon M.; Moon, S. Katie - National Bureau of Economic Research (NBER) - 2014
We examine the impact of outside purchase contracts on firm risk and firm capital structure. We find that firms with …
Persistent link: https://www.econbiz.de/10010951012
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Do Measures of Financial Constraints Measure Financial Constraints?
Farre-Mensa, Joan; Ljungqvist, Alexander - National Bureau of Economic Research (NBER) - 2013
Financial constraints are not directly observable, so empirical research relies on indirect measures. We evaluate how well five popular measures (paying dividends, having a credit rating, and the Kaplan-Zingales, Whited-Wu, and Hadlock-Pierce indices) identify firms that are financially...
Persistent link: https://www.econbiz.de/10010951200
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Investment Under Uncertainty and the Value of Real and Financial Flexibility
Bolton, Patrick; Wang, Neng; Yang, Jinqiang - National Bureau of Economic Research (NBER) - 2014
standard corporate savings models, a financially constrained firm may behave in a risk seeking sense (and thus firm value may …
Persistent link: https://www.econbiz.de/10010951274
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Credit Lines as Monitored Liquidity Insurance: Theory and Evidence
Acharya, Viral V.; Almeida, Heitor; Ippolito, Filippo; … - National Bureau of Economic Research (NBER) - 2013
We propose and test a theory of corporate liquidity management in which credit lines provided by banks to firms are a …-seeking behavior by firms. Firms with high liquidity risk are likely to use cash rather than credit lines for liquidity management … because the cost of monitored liquidity insurance increases with liquidity risk. We exploit a quasi-experiment around the …
Persistent link: https://www.econbiz.de/10010951279
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Real Options, Taxes and Financial Leverage
Myers, Stewart C.; James A. Read, Jr. - National Bureau of Economic Research (NBER) - 2012
value (APV). The risk-free rate of interest must be after-tax. Debt capacity depends on the APV and target debt ratio for … the underlying asset, on the option delta and on the amount of risk-free borrowing or lending that would be needed for … follow the tradeoff theory of capital structure will be lower than target ratios for assets in place. Our results can …
Persistent link: https://www.econbiz.de/10010951377
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How Does Government Borrowing Affect Corporate Financing and Investment?
Roberts, Michael R.; Graham, John; Leary, Mark T. - National Bureau of Economic Research (NBER) - 2014
Using a novel dataset of accounting and market information that spans most publicly traded nonfinancial firms over the last century, we show that U.S. federal government debt issuance significantly affects corporate financial policies and balance sheets through its impact on investors' portfolio...
Persistent link: https://www.econbiz.de/10010951425
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Trade Credit and Taxes
Hines, James R. Hines, Jr.; Desai, Mihir A.; Foley, C. Fritz - National Bureau of Economic Research (NBER) - 2012
This paper analyzes the extent to which firms use trade credit to reallocate capital in response to tax incentives. Tax-induced differences in pretax returns encourage the use of trade credit to reallocate capital from firms facing low tax rates to those facing high tax rates. Evidence from the...
Persistent link: https://www.econbiz.de/10011271378
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What Do Private Equity Firms Say They Do?
Gompers, Paul Alan; Kaplan, Steven N.; Mukharlyamov, … - National Bureau of Economic Research (NBER) - 2015
We survey 79 private equity investors with combined AUM of over $750B about their practices in firm valuation, capital structure, governance, and value creation. Investors rely primarily on IRR and multiples to evaluate investments. Their LPs focus more on absolute performance. Capital structure...
Persistent link: https://www.econbiz.de/10011272305