While academic research concerning capital structure of large corporations has been abundant in the finance literature, studies of small firms have been somewhat less common, and investigation of capital structure at origin (start-up) has been virtually nil. In this paper we present empirical...

Modigliani and Miller present an equity-quantity shifting equilibrating process to achieve an optimal firm value in the presence of corporate taxes. However, in the era in which they derived their various propositions regarding the relation between a firm's value and its capital structure,...

Invoking the same assumptions as Modigliani and Miller (1963), we demonstrate that their debt-only corner solution is not a unique equilibrium and furthermore that an alternative equilibrium exists in which capital structure is irrelevant for determining shareholder value. Our equilibrium...

Modigliani and Miller present an equity-quantity shifting equilibrating process to achieve an optimal firm value in the presence of corporate taxes. However, in the era in which they derived their various propositions regarding the relation between a firm’s value and its capital structure,...

Modigliani and Miller (1963) present an equity-quantity shifting equilibrating process to achieve an optimal firm value. However, in the era in which they derived their various propositions regarding the relation between a firm's value and its capital structure, well-capitalized takeover...