Interactions between Corporate Agency Conflicts
AbstractThis paper examines simultaneous incentive conflicts between shareholders, bondholders, and managers. Manager-owner conflicts arise from information asymmetries, and interact with traditional shareholder-bondholder conflicts (i.e., underinvestment and asset substitution conflicts). Managers are aligned with the bondholders' preference to avoid underinvestment, but are aligned with the shareholders' preference for asset substitution, to the extent that riskier investments increase the manager's information advantage. The interactions between conflicts extend the agency cost literature and facilitate empirical implications linking the influence of each party to investment opportunities, financial policy, compensation contracts, and firm value. Copyright (c) 2009, The Eastern Finance Association.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Eastern Finance Association in its journal Financial Review.
Volume (Year): 44 (2009)
Issue (Month): 2 (05)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Baran, Lindsay C. & King, Tao-Hsien Dolly, 2010. "Going private transactions, bondholder returns, and wealth transfer effects," Journal of Banking & Finance, Elsevier, vol. 34(8), pages 1856-1872, August.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.