Taxes, Financing Decisions, and Firm Value

We use cross-sectional regressions to study how a firm's value is related to dividends and debt. With a good control for profitability, the regressions can measure how the taxation of dividends and debt affects firm value. Simple tax hypotheses say that value is negatively related to dividends and positively related to debt. We find the opposite. We infer that dividends and debt convey information about profitability (expected net cash flows) missed by a wide range of control variables. This information about profitability obscures any tax effects of financing decisions.     

Analyst Coverage and Financing Decisions

We provide evidence that analyst coverage affects security issuance. First, firms covered by fewer analysts are less likely to issue equity as opposed to debt. They issue equity less frequently, but when they do so, it is in larger amounts. Moreover, these firms depend more on favorable market conditions for their equity issuance decisions. Finally, debt ratios of less covered firms are more affected by Baker and Wurgler's (2002) “external finance‐weighted” average market‐to‐book ratio. These results are consistent with market timing behavior associated with information asymmetry, as well as behavior implied by dynamic adverse selection models of equity issuance.     

Audit Firm Portfolio Management Decisions

We examine client acceptance and client continuance decisions of a large audit firm to provide empirical evidence on the extent and nature of risk avoidance that the firm uses to purposefully manage its client portfolio. Our results support several key new inferences regarding audit firm portfolio management decisions. First, the results show that this firm is shedding the riskier clients in its portfolio, consistent with the risk avoidance theory of audit firm portfolio management. Second, the results show that the firm's newly accepted clients are less risky than its continuing clients. Although results of both the client continuance and client acceptance decisions imply a less risky portfolio emerging over time, there are greater differences in risk between continuing and discontinued clients than between continuing and newly accepted clients. Third, we find that audit risk factors are more important in audit firm portfolio management decisions than are financial risk factors. Finally, we find no evidence that audit pricing affects the client acceptance and continuance decisions of this firm, controlling for risk and other client characteristics.     

经营风险与营运资金融资决策

本文以2007-2013年的A股上市公司作为样本,考察经营风险对于营运资金融资决策的影响。我们发现,供应商等利益相关者会根据企业的经营风险对其进行"信用配给",经营风险提高了供应链中发生"信用风险传染"的可能性。随着经营风险的上升,企业在运营中更难以利用营业活动自发融资,面临着更高的营运资金融资缺口。在进行营运资金融资决策时,经营风险高的公司会尽量减少使用短期金融性负债这类高风险的融资方式,而选择稳定的营运资本融资作为替代。另外,随着经营风险的提高,上市公司的狭义和广义商业信用供给和需求之间均呈现了明显的正相关关系。     

Do Taxes Affect Corporate Financing Decisions?

This paper provides clear evidence of substantial tax effects on the choice between issuing debt or equity; most studies fail to find significant effects. The relationship between tax shields and debt policy is clarified. Other papers miss the fact that most tax shields have a negligible effect on the marginal tax rate for most firms. New predictions are strongly supported by an empirical analysis; the method is to study incremental financing decisions using discrete choice analysis. Previous researchers examined debt/equity ratios, but tests based on incremental decisions should have greater power.     

Corporate Financing Decisions: UK Survey Evidence

Abstract:  Despite theoretical developments in recent years, our understanding of corporate capital structure remains incomplete. Prior empirical research has been dominated by archival regression studies which are limited in their ability to fully reflect the diversity found in practice. The present paper reports on a comprehensive survey of corporate financing decision-making in UK listed companies. A key finding is that firms are heterogeneous in their capital structure policies. About half of the firms seek to maintain a target debt level, consistent with trade-off theory , but 60% claim to follow a financing hierarchy, consistent with pecking order theory . These two theories are not viewed by respondents as either mutually exclusive or exhaustive. Many of the theoretical determinants of debt levels are widely accepted by respondents, in particular the importance of interest tax shield, financial distress, agency costs and also, at least implicitly, information asymmetry. Results also indicate that cross-country institutional differences have a significant impact on financial decisions.     

Trust‐Preferred Securities and Insurer Financing Decisions

We analyze insurance holding company (IHC) issuance of trust‐preferred securities (TPS) from 1994 to 2013. We find that larger and more financially levered IHCs issued TPS in 1996 and 1997, as well as those that obtained financial strength ratings from A.M. Best. Abnormal stock price returns are positively related to financial distress costs, growth opportunities, and tax burden, but negatively related to size. Consistent with the pecking order theory, intent to use TPS proceeds to retire debt is positively related to abnormal stock returns, whereas intent to use proceeds to retire preferred equity is negatively related to abnormal stock returns.     

On the Interaction of Real and Financial Decisions of the Firm Under Uncertainty

This study analyzes the interaction between the optimal level of investment and debt financing. For this purpose, a model is structured in which a firm, facing an uncertain price, has to decide on its optimal level of investment and debt. The amount of investment sets a limit on output whose optimal level is determined after price is realized. The debt involved is risky (there exists a possibility of bankruptcy). The analysis proves that investment and its optimal financing have to be simultaneously determined and that a negative relationship exists between operating and financial leverage. We also demonstrate that as the tax rate increases, optimal capacity decreases and optimal leverage increases. An analysis of the impact of changes in the expected price shows that under some conditions, an increase in expected price would lead to an increase in optimal investment (firm size) and a decrease in optimal debt.     

管理者特质、负债融资与企业价值

本文基于行为金融理论和高层梯队理论,选用2008-2013年我国A股上市公司数据作为研究样本,区分企业产权性质,实证检验了拥有不同特质的管理者对负债融资行为与企业价值的影响。研究结果显示:我国上市公司的负债融资可以降低企业代理成本,对企业价值有正面的治理效应;管理者为男性、教育水平越高、任期越短、有财务相关工作经历时,越容易出现过度自信,也更偏好使用负债融资,其中管理者性别、教育水平、工作经历更是可以显著提高负债融资对企业价值的提升作用。进一步区分产权性质后发现,和国有公司相比,非国有公司负债融资对企业价值的提升效果更好;非国有公司管理者教育水平、工作经历与负债融资的正相关更强,也更能显著提高负债融资对企业价值的提升作用。本研究不仅丰富了管理者特质和企业融资研究领域的文献和经验证据,而且也表明了在研究负债融资对企业价值的治理效应时,管理者特质和公司的产权性质是重要的考量因素。     

家族企业的控制权转移、融资结构与公司治理

家族企业在其发展过程中必然要不断融资，其融资方式往往偏好于内源融资。如果需要进行外源融资时，大多数家族企业只是进行少量负债，而不愿采用股权融资，其原因在于面临控制权转移的风险。这一融资方式与家族企业的融资结构与公司治理结构有关。     

我国企业债券融资决策的影响因素研究

提高直接融资比重,大力发展债券市场是十二五资本市场发展的一大重点。本文首先对企业在银行贷款和公开发行债券之间的取舍做了理论文献回顾,然后以2005年初至2010年底公开发行债券的上市公司及未发行债券的匹配公司为样本,从企业融资决策的角度,实证检验我国企业债务融资方式的主要影响因素。发现与国外债券市场情况相似,企业发展前景、财务状况和企业规模是影响企业债务融资决策的重要因素。     

Interactions of Corporate Financing and Investment Decisions: A Dynamic Framework

This article analyzes the interaction between a firm's dynamic investment, operating, and financing decisions in a model with operating adjustment and recapitalization costs. Using numerical analysis, we solve the model for cases that highlight interaction effects. We find that higher production flexibility (due to lower costs of shutting down and reopening a production facility) enhances the firm's debt capacity, thereby increasing the net tax shield value of debt financing. While higher financial flexibility (resulting from lower recapitalization costs) has a similar effect, production flexibility and financial flexibility are, to some extent, substitutes. We find that the impact of debt financing on the firm's investment and operating decisions is economically insignificant.     

关于完善我国企业融资结构的几点思考

我国企业融资存在的问题有:金融资源流向国有企业,资金使用效率低下,导致中小企业“融资难”,抑制了中小企业成长壮大;直接融资与间接融资比例失衡,过度依赖间接融资加剧了金融体系风险;正规金融部门的低效率导致金融体系“体外循环”严重,民间金融盛行,规模庞大的民间金融扰乱了正常的金融秩序,影响了货币政策作用的发挥。为此,应采取推动金融体制的改革,消除金融抑制;发展多层次股权融资市场体系;大力发展公司债券市场;引导民间金融规范发展等措施,完善我国企业融资结构。     

Long-Term Financing Decisions: Views and Practices of Financial Managers of NYSE Firms

This paper reports the findings of a 1990 survey of a sample of NYSE firms conducted to learn about the managerial opinions and practices with respect to longterm financing decisions. Relying on a hierarchy of financing sources is discovered to be a far more common practice among the sample firms than maintaining a target capital structure. The risk-return dimensions of the investment being financed are found to be the most important inputs in determining financing decisions. In spite of the perceived lack of fairness in the market pricing of their securities, the sample firms do not report making financing decisions to signal a need for reevaluation of their securities. Financial managers display a much greater flexibility with capital structure decisions than with either dividend policy decisions or investment decisions. The firms which attempt to maintain target capital structures are found to perceive the average debt ratios in their respective industries to be important determinants of their own debt ratios. The firms which follow financing hierarchies on the other hand, are found to view their firms' past profits and past growth to be important determinants of their debt ratios.     

经合组织国家医疗融资结构的收敛：经验与启示

摘要：医疗融资是医疗体制中的一个重要组成部分,具有募集资金、分担与降低风险、购买医疗服务等功能。文章基于17个OECD国家1972—2010年间的医疗融资数据,采用公共融资占医疗总融资的比例和人均公共融资作为收敛检验指标,利用盯收敛和p收敛两种判定收敛的方法,结果显示,总样本中这两项指标均发生了收敛现象,收敛的程度随医疗体制类型和时间段的不同而不同,且并非总是单调的。文章的结论虽只是初步的,但深入研究医疗融资结构收敛及其成因和效果,必将对我国医疗体制改革尤其是医疗融资政策设计具有重要意义。     

Cross-Subsidies, External Financing Constraints, and the Contribution of the Internal Capital Market to Firm Value

We examine the link between the excess value of a diversifiedfirm and the value of its internal capital market. Subsidiesto small financially constrained segments with good relativeinvestment opportunities significantly increase excess value,while transfers of resources from segments with good relativeinvestment opportunities significantly decrease excess value.Of interest is that subsidies to small financially constrainedsegments with poor relative investment opportunities also significantlyincrease excess value. However, there is little evidence thatthis result depends on the diversity of a firm's investmentopportunities. We conclude that financing constraints drivethe relationship between the internal capital market and firmvalue.     

An Analysis of the Financing Decisions of REITs: The Role of Market Timing and Target Leverage

This paper examines the role of capital market conditions and target leverage on the marginal financing decisions of Real Estate Investment Trusts (REITs), which include both capital raising and capital reduction activities. We investigate the relevance of a hybrid hypothesis whereby REITs have target leverage, but they also choose and time their marginal financing decisions according to the capital market conditions. The empirical results suggest that target leverage behavior plays a secondary role to market timing behavior in the financing decisions of REITs. In particular, we find strong and consistent evidence that REITs exhibit market timing behavior in terms of when and what type of capital to issue or reduce. Such market timing practices, motivated by attempts to take advantage of capital market conditions, may shift the firms away from their target leverage. However, we observe that in the long run, most REITs do move their capital structure towards the target debt level.     

金融双语

过剩与不足，或说供大于求与求大于供，都是经济中的非均衡状态。这里的供求对应于意愿的交换数量，即在市场均衡时交易者在不受数量约束的情况下，根据效用最大化原则在现行价格下进行交易的名义供求量。当意愿的交换数量与实际的交易数量不同时，就出现了非均衡。而非均衡也可以是一种均衡，又称非瓦尔拉斯均衡。非瓦尔拉斯均衡是指在一定约束条件下，构成某一经济系统的相互作用的变量经过调整后，该系统不再存在继续变动的趋势，经济处于稳定状态。如果市场是充分有效的，则实际交易需求就取决于意愿供求的短边，即遵循“短边原则”。如果市场上存在摩擦，则实际交易量就会小于意愿供求的任何一方。由于垄断等因素引起的价格刚性、配额问题以及调整成本等的存在，以及由于计划经济中的预算软约束等因素干扰了利润最大化的决策，破坏了瓦尔拉斯均衡的实现前提，使非瓦尔拉斯均衡广泛存在。对于非均衡经济，理性经济人的行为不仅取决于价格信号，还要综合考虑数量信号。     

The Interactions between the Investment, Financing, and Dividend Decisions of Major U.S. Firms

This paper uses 114 responses to a June 1988 mail questionnaire survey of the financial managers of the 1,000 largest U.S. firms to examine Modigliani and Miller's “separation principle”. The opinions of practicing financial managers were found to be consistent with Modigliani and Miller as well as with the work of other empirical researchers. Almost without exception, the direction of causality between investment and financing decisions was found to run from the former to the latter, and dividend decisions were found to be driven by profits and prior year's dividends rather than by the firm's investment and financing actions. Clearly, the beliefs of practicing financial managers seem to reflect acceptance of Modigliani and Miller's “separation principle.”