The influence of moral hazard on investment in financially constrained and unconstrained firms

We extend Triole (2006) to link together two seemingly different cases – firms facing potential free cash flow problems versus firms facing financial constraints. The model predicts a large number of disparate findings in the empirical literature and so demonstrates its usefulness.

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Year of publication:	2014
Authors:	Keefe, Michael O’Connor ; Kieschnick, Robert
Published in:	Finance Research Letters. - Elsevier, ISSN 1544-6123. - Vol. 11.2014, 3, p. 272-281
Publisher:	Elsevier
Subject:	Investment \| Moral Hazard \| Financial constraints \| Free cash flow

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Type of publication:	Article
Classification:	G32 - Financing Policy; Capital and Ownership Structure ; G35 - Payout Policy ; D21 - Firm Behavior ; D82 - Asymmetric and Private Information
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010940017