Asymmetries in the firm's use of debt to changing market values

0490260 - NHU-C 2019 RIV NL eng J - Článek v odborném periodiku
Ferris, S. P. - Hanousek, Jan - Shamshur, A. - Trešl, J.
Asymmetries in the firm's use of debt to changing market values.
Journal of Corporate Finance. Roč. 48, February (2018), s. 542-555. ISSN 0929-1199. E-ISSN 1872-6313
Grant CEP: GA ČR(CZ) GA15-15927S
Institucionální podpora: Progres-Q24
Klíčová slova: market leverage * book leverage * capital structure
Obor OECD: Finance
Impakt faktor: 2.349, rok: 2018

Using a sample of U.S. firms over the period, 1984 to 2013, this study examines the relation between market and book leverage ratios. Unlike Welch (2004) who contends that changes in market leverage do not induce adjustments in book leverage, we find an asymmetric effect. That is, firms adjust their book leverage only when the changes in market leverage are due to increases in equity values. No adjustment is observed when firm equity values decrease. Our results are consistent with Myers (1977) and Barclay et al. (2006) who argue that optimal debt levels decrease with corporate growth opportunities.
Trvalý link: http://hdl.handle.net/11104/0284524