This article tests the trade-off theory against the pecking-order theory of corporate financing behavior on a panel data set of publicly traded Japanese firms for 1964 to 2005. Comparing the explanatory powers for both the trade-off and the pecking-order models, we find the following. First, for...

We investigate the motives and consequences of the consolidation of cooperative banks (Shinkin) in Japan during the period 1984-2002. Our major findings are as follows. First, less profitable and less cost efficient banks are more likely to be an acquirer and a target, though even less...