Asymmetries in the firm’s use of debt to changing market values

PDF
1-s2.0-S0929119917304078-main.pdf - Published
Download (368kB)

DOI:	https://doi.org/10.1016/j.jcorpfin.2017.12.006
URL:	https://www.sciencedirect.com/science/article/pii/...
Additional URL:	https://www.researchgate.net/publication/321749898...
URN:	urn:nbn:de:bsz:180-madoc-631584
Document Type:	Article
Year of publication:	2018
The title of a journal, publication series:	Journal of Corporate Finance
Volume:	48
Issue number:	1
Page range:	542-555
Place of publication:	Amsterdam [u.a.]
Publishing house:	Elsevier
ISSN:	0929-1199
Publication language:	English
Institution:	Business School > ABWL, Finanzwirtschaft u. Finanzmarktinstitutionen (Spalt 2019-)
Pre-existing license:	Creative Commons Attribution 4.0 International (CC BY 4.0)
Subject:	650 Management
Abstract:	Using a sample of U.S. firms over the period, 1984 to 2013, this study examines the relation between market and book leverage ratios. Unlike Welch (2004) who contends that changes in market leverage do not induce adjustments in book leverage, we find an asymmetric effect. That is, firms adjust their book leverage only when the changes in market leverage are due to increases in equity values. No adjustment is observed when firm equity values decrease. Our results are consistent with Myers (1977) and Barclay et al. (2006) who argue that optimal debt levels decrease with corporate growth opportunities.

	Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.
	Dieser Datensatz wurde nicht während einer Tätigkeit an der Universität Mannheim veröffentlicht, dies ist eine Externe Publikation.

BASE: Ferris, Stephen P. ; Hanousek, Jan ; Shamshur, Anastasiya ; Tresl, Jiri

Google Scholar: Ferris, Stephen P. ; Hanousek, Jan ; Shamshur, Anastasiya ; Tresl, Jiri

Downloads per month over past year

You have found an error? Please let us know about your desired correction here: E-Mail

Show item