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A theory of outside equity : financing multiple projects

Bougheas, Spiros P.; Wang, Tianxi - 2019

In the financial economics literature debt contracts provide efficient solutions for addressing managerial moral hazard problems. We analyze a model with multiple projects where the manager obtains private information about their quality after the contract with investors is agreed. The...

Persistent link: https://www.econbiz.de/10011962270

The commitment role of equity financing

Fahn, Matthias; Merlo, Valeria; Wamser, Georg - 2014

firms rely heavily on equity financing, even though benefits associated with debt (like tax shields) appear to be high and … popular among employees. We demonstrate that such financing behavior may be driven by implicit arrangements made between a … firm and its managers/employees. Equity financing generally strengthens a firm’s credibility to honor implicit promises …

Persistent link: https://www.econbiz.de/10010366170

Relational contracts, the cost of enforcing formal contracts, and capital structure choice : theory and evidence

Fahn, Matthias; Merlo, Valeria; Wamser, Georg - 2017

firm's financing structure. We analyze the interaction between a firm's capital structure and the type of contracts it uses … substantially more equity financing. …

Persistent link: https://www.econbiz.de/10011674383

Microeconometric evidence of financing frictions and innovative activity

Tiwari, Amaresh; Mohnen, Pierre A.; Palm, Franz C.; … - 2014

Using Dutch data we empirically investigate how financing and innovation vary across firm characteristics. We find that … when firms face financial constraints, debt financing and innovation choices are not independent of firm characteristics … innovate and the change in the propensity to innovate no longer varies with firm characteristics. We find that financing …

Persistent link: https://www.econbiz.de/10010249680

On the capital structure of foreign subsidiaries : evidence from a panel data quantile regression model

Miniaci, Raffaele; Panteghini, Paolo - 2021

This paper studies how variations in tax rates and profitability affect the (unconditional) quantiles of the distribution of the leverage of European foreign owned subsidiaries in the presence of unobserved company characteristics, possibly correlated with their observable dimensions. To achieve...

Persistent link: https://www.econbiz.de/10012514927

Taxation and the optimal constraint on corporate debt finance

Sørensen, Peter Birch - 2014

the tax distortions to corporate financing decisions amounts to 2-3 percent of total corporate tax revenue, and the …

Persistent link: https://www.econbiz.de/10010438191

Neutral taxation of shareholder income? : corporate responses to an announced dividend tax

Alstadsæter, Annette; Fjaerli, Erik - 2009

The introduction of the 2006 Norwegian shareholder income tax was announced in advance, and it increased top marginal tax rates on individual dividend income from zero to 28 percent. We document strong timing effects on dividend payout on a large panel of non-listed corporations, with a surge of...

Persistent link: https://www.econbiz.de/10003806745

Investor taxation, firm heterogeneity and capital structure choice

Haring, Magdalena; Niemann, Rainer; Rünger, Silke - 2016

We analyze the effect of investor level taxes, firm-specific ownership structure and firm-specific payout policy on firms' capital structure choice. Our analysis is based on data for 10,983 firms from 13 Central and Eastern European (CEE) countries over the time period 2002-2012. Our results...

Persistent link: https://www.econbiz.de/10011541065

Evaluating the effects of ACE systems on multinational debt financing and investment

Hebous, Shafik; Ruf, Martin - 2015

allowance for corporate equity (ACE) to achieve tax neutrality. We study the effects of adopting an ACE on debt financing …

Persistent link: https://www.econbiz.de/10010519931

Reallocation of corporate resources and managerial incentives in internal capital markets

Brusco, Sandro; Panunzi, Fausto - 2002

Diversified firms often trade at a discount with respect to their focused counterparts. The literature has tried to explain the apparent misallocation of resources with lobbying activities or power struggles. We show that diversification can destroy value even when resources are efficiently...

Persistent link: https://www.econbiz.de/10011410226