how liquidity and risk management policies coordinate investment and executive compensation policies to efficiently retain … flush with liquidity and the latter is the only consideration when the firm has depleted its financial slack. We show that …

We analyze a model of optimal capital structure and liquidity choice based on a dynamic tradeoff theory for financially … introduce a cost of external financing for the firm, which generates a precautionary demand for liquidity and an optimal … liquidity management policy for the firm. An important new cost of debt financing in this context is an endogenous debt …

We analyze a model of optimal capital structure and liquidity choice based on a dynamic tradeoff theory for financially … introduce a cost of external financing for the firm, which generates a precautionary demand for liquidity and an optimal … liquidity management policy for the firm. An important new cost of debt financing in this context is an endogenous debt …

We analyze a dynamic model of optimal capital structure and liquidity management when firms face external financing … financing in this context is an endogenous debt servicing cost: debt payments drain the firm's valuable liquidity reserves and … thus impose higher expected external financing costs on the firm. The precautionary demand for liquidity also means that …