Fiscal consolidations and the cost of credit
In: Journal of international economics, Band 120, S. 84-108
ISSN: 0022-1996
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In: Journal of international economics, Band 120, S. 84-108
ISSN: 0022-1996
In: Emerging markets, finance and trade: EMFT, Band 48, Heft sup4, S. 71-95
ISSN: 1558-0938
In: Journal of international economics, Band 88, Heft 1, S. 198-208
ISSN: 0022-1996
In: The journal of financial research: the journal of the Southern Finance Association and the Southwestern Finance Association, Band 31, Heft 2, S. 85-112
ISSN: 1475-6803
AbstractWe examine the effect of agency conflicts on debt financing and show that managerial ownership and its interaction with takeover defenses affect these decisions. We find that (1) the relation between leverage and takeover defenses becomes insignificant when we control for the interaction of these defenses with managerial ownership, and (2) firms with large managerial ownership operate at high debt levels unless they have a large number of takeover defenses. Therefore, a two‐dimensional aspect of governance that includes the interaction between managerial ownership and takeover defenses is useful in understanding the effect of agency conflicts on firms' debt financing decisions.