The stakeholder theory of capital structure proposed by Titman (1984) argues that firms will take into account the nonfinancial stakeholders' preferences when making capital structure decisions. In particular, firms selling specialized products will choose a lower leverage ratio. We propose a...

Contrary to recent accounts of off-balance sheet securitization by financial firms, we show that asset securitization by nonfinancial firms provides a valuable form of financing to shareholders without harming firms' debtholders. Using data from firms' SEC filings, we find that securitization is...