Dynamic Optimal Capital Structure and Technological Change

Lööf, Hans

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URL: http://ub-madoc.bib.uni-mannheim.de/190
URN: urn:nbn:de:bsz:180-madoc-1908
Document Type: Working paper
Year of publication: 2003
The title of a journal, publication series: None
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: C51 C23 G32 O16 O31 ,
Subject headings (SWD): Kapitalstruktur , technischer Fortschritt
Abstract: This paper incorporates the cost of adjustment between observed and optimal leverage in explaining the variation in firms equity or bank-debt financing investments. Using a dynamic adjustment approach identifies the determinants to capital structure between different financial systems. In relation to firm sales U.K and U.S firms have 50-100 percent more equity financing than Swedish firms depending on which measure used, while the ratio of debt to sales is highest in Sweden. The major findings are that observed leverage often deviates from the target leverage in both equity and debt dominated systems. There are large and also unexpected crosscountry differences in determinants to optimal capital structure. Swedish and U.K. firms deviate more from the optimal level than U.S firms. A faster speed towards the target is observed in the equity based systems.
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Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.

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