this paper analyzes the relationship between capital structure and earning management. for analyzing we use 119 non-financial companies that listed in tehran stock exchange from 2000 to 2008. the researchers will focus on comparing the jones model and the modified jones model, which are the two most frequently used model in empirical analysis nowadays. earnings management is a kind of managemen...

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...

The aim of this empirical study is to explore the trade-off model and pecking order model of capital structure. The investigation is performed using panel data procedures for a sample of 76 firms listed in Tehran Stock Exchange during 2007-2010.The study employs OLS regression model in examining the capital structure of firms in Iran. The study employs variables reflecting differing theoretical...

In this study, using various panel models and estimators, we find empirically that the trade-off and pecking order theories are not mutually exclusive in explaining quoted Portuguese companies capital structure decisions. However, the finance behaviour of quoted Portuguese companies comes close to that forecast by the pecking order theory: (i) the magnitude of the effects of financial deficit o...

We study a novel aspect of a firm’s capital structure, namely the profile of its debt maturity dates. In a simple theoretical framework we show that the dispersion of debt maturities constitutes an important dimension of capital structure choice, driven by firm characteristics and debt rollover risk. Guided by these results we establish two main empirical results. First, using an exogenous shoc...

It frEBT-management policies of the U.S. Government are actions which affect the composition of the publicly held Federal debt. Such actions include operations of both the U.S. Treasury and the Federal Reserve. As a macroeconomic policy tool, discretionary debt-management policy attempts to affect economic activity in a specific way by altering the maturity structure of the Government’s debt. T...

We model dynamic investment, financing and default decisions of a firm, which begins its life with a collection of growth options. The firm exercises them optimally over time, and finances the costs of investment by adjusting its capital structure, which trades off the tax benefits with the distress cost of debt and the agency cost of investment distortions from potential debt overhang. Conflic...

The Modigliani-Miller Theorem on the irrelevance of corporate capital structure is perhaps the best-known result in modern finance. Simply put, the theorem states that, under certain assumptions, the market value of a firm is independent of its capital structure. Under the stylized assumptions of the theorem, substituting equity for debt or adding layers of debt to the capital structure of a fi...

A tax-smoothing objective is used to assess the optimal composition of public debt with respect to maturity and contingencies. This objective motivates the government to make its debt payouts contingent on the levels of public outlay and the tax base. If these contingencies are present, but asset prices of non-contingent indexed debt are stochastic, then full tax smoothing dictates an optimal m...