Capital Structure, Firm Liquidity and Growth
نویسنده
چکیده
This paper is an exploration of the relationships among the firm's financial structure, its choice of liquid asset holdings, and growth. The literature on the determinants of economic growth has long studied the role of financial development in promoting growth. The literature on corporate finance provides some microeconomic underpinnings for this relationship in the form of a variety of partial equilibrium analyses showing how capital structure can effect the firm’s investment decisions and therefore its growth. To date this literature has overlooked the channel between financial structure and growth that we examine here.
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