Investment Decisions, Debt Renegotiation Friction, and Agency Conflicts

Autor:	Hwa‐Sung Kim
Rok vydání:	2018
Předmět:	Economics and Econometrics 050208 finance media_common.quotation_subject 05 social sciences Monetary economics Investment (macroeconomics) Investment decisions Bargaining power Shareholder Debt 0502 economics and business Agency (sociology) Economics 050207 economics Finance media_common
Zdroj:	International Review of Finance. 20:493-504
ISSN:	1468-2443 1369-412X
DOI:	10.1111/irfi.12208
Popis:	This paper investigates how investment decisions are influenced by the possibility of debt renegotiation failure and shareholder–debtholder conflicts by extending the Sundaresan and Wang (2007) model. We find that the difference in investment thresholds due to agency conflicts decreases as shareholders’ bargaining power increases. We also show that as the probability of renegotiation friction is lower, the investment threshold is lower, which is consistent with the empirical result of Favara et al. (2017).
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::0d2d12d4960d5a499de586b529fba147 https://doi.org/10.1111/irfi.12208 Zobrazit plný text záznamu