Download or read book Essays on Capital Structure and Investment written by Evan Dudley and published by . This book was released on 2008 with total page 306 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Capital Structure and Trade Financing written by Klaus Hammes and published by Department of Economics School of Economics and Commercial Law Go. This book was released on 2003 with total page 188 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Capital Structure and Investment of Non financial Firms written by Ahmed Usman and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Capital Structure and Firm Investment written by Yiming Xu and published by . This book was released on 2019 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this thesis, I study the interactions between firms' capital structure and real decisions. First, I investigate how a firm's financial leverage will impact its investment contingent on whether future growth opportunities are anticipated. Second, I test the under and over investment hypothesis related to debt financing contingent on whether the firm is likely to under or over invest. Last, I investigate how a firm's production technology can impact its production and capital structure decisions. In Chapter 1, I investigate the impact of anticipations of future growth opportunities on leverage-investment interactions. I show that when growth opportunities are unanticipated, the negative impact of leverage on investment is up to two times larger than when they are anticipated. The presence of institutional stockholdings significantly reduces the under investment problem. An instrumental variable analysis reveals that the leverage-investment relationship is weak when the problem of endogeneity is controlled. The results provide strong evidence that Canadian firms take ex ante leverage adjustments to mitigate the debt overhang problem. Chapter 2 studies the extent to which leverage-investment interactions depend on the level of initial investment as well future investment opportunities in US firms. I find a strong negative relationship between leverage and investment for firms with low levels of (initial) investment and high investment opportunities. I also find a positive relationship between leverage and investment for firms with high levels of (initial) investment and low growth opportunities. I distinguish between Tobin's Average Q and Marginal Q as proxies for firms' investment opportunities and propose a novel method to estimate Marginal Q. Chapter 3 is a joint work with Varouj Aivazian. In this chapter, we investigate the interactions between the flexibility of a firm's production and its financial structure. This chapter shows that production flexibility is an important factor explaining the cross sectional variations in financial leverage among U.S. firms. Alternative empirical measures of production flexibility are all shown to be positively associated with financial leverage. This chapter also develops a novel measure of inter-temporal production flexibility and identifies important linkages between production and financing decisions.
Download or read book Essays in Institutional Investment and Corporate Capital Structure written by Tian Tang and published by . This book was released on 2008 with total page 288 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Capital Structure and Corporate Investment written by Alfonsina Iona and published by . This book was released on 2004 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Capital Structure written by Nirvalur R. Vijayaraghavan and published by . This book was released on 1986 with total page 96 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Does capital structure influence firms value written by Ulrike Messbacher and published by GRIN Verlag. This book was released on 2005-12-20 with total page 12 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essay from the year 2004 in the subject Business economics - Investment and Finance, grade: 1, University of Applied Sciences Kempten (University of Ulster), language: English, abstract: In accordance with the Signalling model by Ross (1977) an increase in gearing represents, in term of a company’s prospective cash flows, a positive signal to external investors. Because, due to the higher risk of financial distress, companies with less optimistic market prospective tend to avoid additional financial obligations. This implies that an increasing indebtedness means a higher quality of business and therefore better valuation. This leads, in turn, to the assumption that the corporate management can influence a firm’s value by changing its capital structure. If capital structure can affect value, how can firms identify an optimal capital structure and what will it look like? It is that mix of debt and equity that maximises the value of a firm and, at the same time, minimise overall cost of capital. In their seminal article, published in 1958 and 1963, Modigliani and Miller argue that under certain assumptions the value of a firm i s independent of its capital structure, but with tax-deductible interest payments, they are positively related. Moreover, there are other approaches with partly contradictory perceptions. For instance, Myers (1998, cited in Fairchild 2003, p.6) argues that there is no universal optimal mix of debt and equity; in fact it depends on firms or industries, and therefore should be considered on a case-by-case basis. Other researchers have added market imperfections, such as bankruptcy costs, agency costs, and gains from leverage- induced tax shields to the analysis and have maintained that an optimal capital structure may exist (Hatfieldet al.1994, p.1). First, this paper shows the basic determinants of a firm’s value in association with the impact of financial leverage on payoffs to stockholders. Secondly, it considers some arguments of capital structure theories, particularly the Modigliani and Miller theorem and the Traditional approach and contrasts them. Finally, the underlying factors of the model assumptions are examined and shown that they are important in the choice of a firm’s debt-equity ratio.
Download or read book Corporate Control and Capital Structure written by Erik Berglöf and published by . This book was released on 1991 with total page 228 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on the Capital Structure of Real Estate Investment Trusts written by Eva Maria Steiner and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Corporate Risk and Capital Structure written by Babak Lotfaliei and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: "This dissertation consists of two essays and five chapters. The first essay in chapter two addresses the zero-leverage puzzle, the observation that many firms do not issue debt and thus seem to forego sizable debt benefits. Based on the trade-off theory, a firm financed with debt saves on taxes, while it faces the debt costs associated with financial distress. Firms issue debt and net a positive gain by trading off costs and benefits. However, zero-levered firms seemingly ignore significant tax advantages associated with debt financing. I propose that this behavior is due to the value in waiting to issue debt and postponing debt costs. By considering the real option of issuing debt, small and risky firms have incentives to postpone debt issuance, even when standard trade-off theory predicts that these firms should have leverage. Thus, the value of debt-free firms should include an option component whose value is derived from future debt issuance benefits. I present a simple model for a firm's optimal issuance with optimal leverage and default, and find the factors that increase the propensity to remain zero-levered: high volatility, high debt costs, low tax levels, low payout rate, and small size. I verify the factors empirically on a sample of zero-leverage (ZL) firms by estimating a survival and a choice model and an out-of-sample test on levered firms.The second essay in chapter three provides an explanation for the underleverage puzzle by relating it to volatility risk premia. As a stylized fact, many firms have lower leverage compared to what the trade-off theory predicts, in particular based on their low asset volatility. In addition, the underleverage is the highest for Investment-Grade (IG) firms. Without volatility risk, the essay empirically documents that underleverage across firms increases with volatility risk premium at the asset level. The result is the motive to present two models with stochastic asset volatility that feature optimal capital structure. With priced asset volatility risk, the models in standard trade-off settings show that a higher premium implies lower leverage; the assets' Variance Risk Premia (VRP) reduce tax benefits and increase debt costs. Empirically, the models' calibration leaves no significant underleverage patterns in the cross-section of the firms. Thus, seemingly underleveraged firms have high asset volatility risk premia relative to their low physical asset volatility, which explains their apparent underleverage. In particular, the largest proportion of the volatility is systematic for IG firms; and, consequently, VRP are the highest. This in turn leads to a lower implied leverage, close to the IG firms' empirical leverage.Chapter four reviews the literature related to the earlier chapters. Chapter five concludes with the main findings and provides venues for the future research." --
Download or read book Essays on Voting Power Corporate Governance and Capital Structure written by Yinghong Chen and published by . This book was released on 2004 with total page 204 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Three Essays on the Effect of Regulations on Corporate Capital Structure Investment Performance written by Zoya Saher and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Essays on Innovation and Capital Structure written by Jiahong Zhang and published by . This book was released on 2010 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation aims at improving the understanding of the relation between innovation investment, financial constraints and capital structure in the context of emerging economies. Since early 1930s, economists have argued that innovation is essential for firm survival, economic growth and development. An independent strand of the literature demonstrates that innovation by firms is a key driver of economic growth. Meanwhile, people also recognized that innovation investment is difficult to finance in a competitive marketplace due to various factors such as taxes, transaction costs, and especially informational asymmetries with external investors. Therefore, financing of innovation becomes an important managerial and policy challenge. A lot of studies have focused on identifying the financial constraints related to risky R&D and innovation investments. Nevertheless, there is little research highlighting the mechanisms that different external financing sources can affect innovation activities differently. Moreover, the implications of innovation investment for future capital structure decisions have not been fully analyzed. I try to shed light on these issues using micro evidence in the context of emerging markets, where financial markets, political systems and economic systems are different than those in the industrialized economies such as the US. Both of the chapters imply the importance of equity financing on innovation investment in developing countries especially for those young, small and private firms. The finding points to the significance of the private equity market for financing of innovation in the emerging economy context.
Download or read book Essays on Capital Structure and Dividend Policy written by Mark Allen Taranto and published by . This book was released on 2001 with total page 238 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Two Essays on how Do Investors Perceive the Optimal Capital Structure and an Essay on Mutual Fund Volatility Decomposition and Manager Skill written by Nima Vafai and published by . This book was released on 2022 with total page 111 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation explores the rational investment hypothesis proposed by classical theories at the stock and portfolio (mutual fund) level. My first two essays focus on the risk associated with the composition of debt and equity at the firm level. The third essay studies the total risk at the portfolio level in the mutual fund setting.In the first essay, we examine the association between deviations from the optimal capital structure and firm-level stock returns by comparing different proxies for optimal capital structure from the literature and constructing improved industry-specific optimal capital structure measures. After comparing the performance of each measure, we use a partial adjustment model to study how firms reduce their gap from optimal leverage. In the second essay, we model firms' deviations from the optimal capital structure as a new risk factor in the cross-section of stock returns. Using Monte-Carlo simulations to conduct bootstrapped mean-variance spanning tests, we examine whether the existing Fama and French factors can explain this potential new risk factor. We also use Text Network Industry Classification (TNIC) to show whether the new risk factor is robust to alternative industry classification. In the third essay, we use a volatility decomposition to identify the underlying sources of differences in the performance of low and high-volatility mutual funds. We then examine whether the difference in performance is fund-specific and due to the manager's skill, or it is a broad characteristic of market volatility. Last, we show how the difference in the performance of low and high volatility mutual funds is related to the existence of a beta anomaly in the mutual fund industry. Furthermore, we examine the idiosyncratic volatility relation with beta and risk-adjusted return (alpha) at the fund level.
Download or read book Three Essays on Capital Structure written by Mona Yaghoubi and published by . This book was released on 2017 with total page 159 pages. Available in PDF, EPUB and Kindle. Book excerpt:
