The traditional view is that interest deductibility encourages firms to use debt financing; however, some argue that the personal tax disadvantage to interest offsets the corporate tax advantage. This paper investigates the degree to which personal taxes affect corporate financing decisions. In crosssectional regressions that control for personal taxes, debt usage is positively correlated with ...

We develop simple models in which corporate governance affects the financing and the production level of firms. In this paper, better corporate governance implies governance under which a smaller firm value can be expropriated by the manager, ceteris paribus. We assume that the potential expropriation can occur after production. In the single firm model, we investigate how corporate governance ...

this research was conducted to provide a desired pattern based on the relationship between entrepreneurial strategy and the dimensions of corporate entrepreneurial orientations in physical education organization. predictive variables were entrepreneurial strategy components (intensity of environmental investigation, flexibility of planning, planning vision, planning focus and control) and the c...

This paper examines how asset risk impacts corporate investment and financing decisions. We derive a general model that incorporates risk, adjustment cost, and depreciation features of assets-in-place into investment decisions. The model suggests that the risk and adjustment cost of assets-in-place reduce both corporate investment and financing. We empirically test the model in a panel of US fi...

Article history: Received 4 July 2009 Received in revised form 26 May 2012 Accepted 3 August 2012 Available online 5 October 2012 Controlling for country-level governance, we investigate how firms' corporate governance influences financing constraints. Using firm-level corporate governance rankings across 14 emerging markets, we find that better corporate governance lowers the dependence of eme...

Increasing the value is important for corporate, determinants of which include financing posture, profitability, growth, and size. This research aims to prove intermediary role posture profitability in strategy increasing corporate value. Data was collected from companies LQ 45 index group February July 2022. The results that size have a substantial positive contribution on growth negative Prof...

This paper studies the behavior of leverage ratios in a dynamic trade-off model with real frictions. Firms underutilize debt when financing investment to retain financial flexibility. Underutilization of debt persists even when firms exercise their last investment options, and it is more (less) severe for more back-loaded (front-loaded) investment opportunities. Thus, leverage dynamics cruciall...

Access to external finance, such as bank loans or trade credit, is a key determinant of a firm’s ability to develop, operate, and expand. Economic researchers have studied how various macroeconomic and microeconomic factors influence such access; for example, it has been shown to depend on the macroeconomic environment, since economic downturns tend to limit firms’ ability to borrow and banks’ ...

The Interdependence of Organizational Knowledge and Financing: Studies of Technological Innovation, Learning, and Corporate Restructuring in U.S. Medical Device Ventures

The 2008 financial crisis exemplifies significant uncertainties in corporate financing conditions. We develop a unified dynamic q-theoretic framework where firms have both a precautionary-savings motive and a market-timing motive for external financing and payout decisions, induced by stochastic financing conditions. The model predicts (1) cuts in investment and payouts in bad times and equity ...