one of the economic problems in the developing countries is the debt problem. external debt occurs in the developing countries due to the elimination of the restrictions on the savings gap, the foreign exchange gap, and the fiscal gap in order to form the capital to accelerate the economic growth (karakoy et al., 2012, p. 491). in contrast, borrowing and rising the external debt could be little...

We develop a dynamic structural model to examine the e¤ects of di¤ering beliefs of the manager and outsider investors regarding the pro…tability of a …rm’s projects and managershareholder agency con‡icts on its capital structure. The manager receives dynamic incentives through explicit contracts with shareholders whose implementation through …nancial securities leads to a dynamic capital struct...

Most analyses of monetary policy delegation schemes typically ignore the behavior of the fiscal policy maker. The paper investigates how monetary price level targeting or monetary nominal income targeting may yield social gain in an economy with government debt and where the fiscal policymaker, acting strategically, may take counter actions. We argue that the choice of fiscal policy instrument ...

Financing pattern of firms from developing nation always remains a mystifying area of finance. Present study aims to investigate the determinants of capital structure. Moreover, it is also tried to answer that how these potential determinants can affect financing pattern of developing nation firms. To achieve research objectives data for 323 Pakistani manufacturing firms have taken for the peri...

According to existing dynamic capital structure trade off theories equity holders never find it in their best interest to reduce debt voluntarily before bankruptcy or without renegotiating with creditors. This paper develops a model in which firms optimize the maturity structure of debt to commit to future downward restructurings. It is demonstrated that equityholders of firms with short-term d...