Previous studies that have tested the pecking order theory have been inconclusive. In this paper, we use unique survey results for private Brazilian firms in order to investigate firms' choice of capital structure. We document that ultimate owners of privately owned firms follow the pecking...

This research study has attempted to indirectly test the proposition that the probability of corporate failure is mainly related to the unsystematic component of the total risk. The authors conjecture confirms that managing the total cash-flow risk of the firm significantly affects both the...

This paper explores the financial characteristics of successful Canadian small- and medium-sized enterprises (SMEs). It asks whether industry membership and early growth history play a role in shaping these financial characteristics. Industry comparisons are based on production activity and...

This study estimates the effect of COVID-19 on listed small and medium enterprises' capital structures in Vietnam from 2010 to 2020 by a dynamic panel model with 825 observations. Conducting the generalized method of moments, the findings show that COVID-19 is a significant factor affecting...

We test the hypotheses that, in presence of financial constraints, a low leverage policy directed at maintaining financial flexibility can affect company investment. Low leverage is defined according to deviations from target which are estimated via GMS-SYS. Our analysis reveals that, following...

I show that ownership by blockholding and board composition is an important determinant ofcorporate debt maturity structure. Using GMM methodology to control for the potential endogeneityof all regressors, I find a statistically and economically significant negative relation between...

This paper studies conservative debt policies, focusing on firms with no debt (zeroleverage)or with extremely low debt. Examining an unbalanced panel of U.K. firms,we show that debt conservatism is a common, persistent yet puzzling empiricalregularity: nearly 10% of U.K. firms have zero leverage...

We present an experiment designed to test the Modigliani-Miller theorem. Applyinga general equilibrium approach and not allowing for arbitrage among firmswith different capital structures, we find that, in accordance with the theorem, participantswell recognize changes in the systematic risk of...

This paper develops a structural equilibrium model with intertemporal macroeconomic risk, in-corporating the fact that ¯rms are heterogeneous in their asset composition. Compared to ¯rmswhich are mainly composed of invested assets, ¯rms with growth options have larger costs ofdebt because...