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Ben-David, Itzhak; Chinco, Alexander M. - National Bureau of Economic Research - 2023

Textbook theory assumes that firm managers maximize the net present value of future cash flows. But when you ask them, real-world firm managers consistently say that they are maximizing something else entirely: earnings per share (EPS). Perhaps this is a mistake. No matter. We take firm managers...

Persistent link: https://www.econbiz.de/10014250143

Q-Monetary Transmission

Jeenas, Priit; Lagos, Ricardo - National Bureau of Economic Research - 2022

We study the effects of monetary-policy-induced changes in Tobin's q on corporate investment and capital structure. We … evidence, and quantify the relevance for monetary transmission to aggregate investment …

Persistent link: https://www.econbiz.de/10013210051

Leverage and Cash Dynamics

DeAngelo, Harry; Gonçalves, Andrei S.; Stulz, René M. - National Bureau of Economic Research - 2021

This paper documents new and empirically important interactions between cash-balance and leverage dynamics. Cash ratios typically vary widely over extended horizons, with dynamics remarkably similar to (and complementary with) those of capital structure. Leverage and cash dynamics interact...

Persistent link: https://www.econbiz.de/10012585454

Cash Holdings and Credit Risk

Acharya, Viral V. - 2011

Intuition suggests that firms with higher cash holdings are safer and should have lower credit spreads. Yet empirically, the correlation between cash and spreads is robustly positive and higher for lower credit ratings. This puzzling finding can be explained by the precautionary motive for...

Persistent link: https://www.econbiz.de/10012461663

The Determinants and Implications of Corporate Cash Holdings

Opler, Tim - 1997

assets to ensure that they will be able to keep investing when cash" flow is too low relative to planned investment and when …

Persistent link: https://www.econbiz.de/10012472578

Liquidity Transformation in Asset Management : Evidence from the Cash Holdings of Mutual Funds

Chernenko, Sergey - 2016

We study liquidity transformation in mutual funds using a novel data set on their cash holdings. To provide investors with claims that are more liquid than the underlying assets, funds engage in substantial liquidity management. Specifically, they hold substantial amounts of cash, which they use...

Persistent link: https://www.econbiz.de/10012456286

Cash Flow and Investment : Evidence from Internal Capital Markets

Lamont, Owen - 1996

companies. I test the joint hypothesis that 1) a decrease in cash/collateral decreases investment, holding fixed the … profitability of investment, and 2) the finance costs of different parts of the same corporation are interdependent. The results … support this joint hypothesis: oil companies significantly reduced their non-oil investment compared to the median industry …

Persistent link: https://www.econbiz.de/10012473360

How Does Government Borrowing Affect Corporate Financing and Investment?

Graham, John - 2014

debt is strongly negatively correlated with corporate debt and investment, but strongly positively correlated with … strategy influences firms' capital structures and investment policies …

Persistent link: https://www.econbiz.de/10012458084

Contingent Credit Under Stress

Acharya, Viral V.; Jager, Maximilian; Steffen, Sascha - National Bureau of Economic Research - 2023

Over the past two decades, banks have increasingly focused on offering contingent credit in the form of credit lines as a primary means of corporate borrowing. We review the existing body of research regarding the rationales for banks' provision of liquidity insurance in the form of credit...

Persistent link: https://www.econbiz.de/10014437040

The Secular Decline in Private Firm Leverage

Dobridge, Christine L.; Gilje, Erik P.; Whitten, Andrew - National Bureau of Economic Research - 2022

private firms is correlated with lower investment. Our findings have important implications for theories on how firm leverage … and investment relate to economic fluctuations …

Persistent link: https://www.econbiz.de/10013210062

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