We investigate the motivations for conducting equity issues by examining the value that investors place on cash around the offerings. The marginal value of cash for issuing firms is twice that of non-issuing firms. The higher relative valuation persists subsequent to the issue, indicating that...

Despite the importance of trade credit as a source of financing there is a significant and persistent decline in this form of short-term borrowing and lending over the 1979 to 2018 interval. We find that the median firm's accounts receivable ratio decreased by 52 percent while accounts payable...

The median U.S. non-regulated firm reports a 47 percent decline in leverage ratio between 1980 and 2010. We investigate whether the cost-benefit tradeoff to shareholders, captured by the valuation impact of an additional dollar of debt on owners' equity, is an explanation for the observed change...

We observe a persistent increase in the percentage of firms with little or no debt in their capital structure over the last three decades. The fraction of firms with less than five percent debt in their capital structure increases from 14.01 percent in 1977 to 34.42 percent in 2010 while the...