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The Role of Owner in Capital Structure Decisions: An Analysis of Single-Owner Corporations

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  • James Ang

    (Florida State University)

  • Rebel Cole

    (DePaul University)

  • Daniel Lawson

    (Gonzaga University)

Abstract

This study examines the extent to which individual demographic characteristics of owners influence capital structure desisions. Using the Federal Reserve's 2003 Survey of Small Business Finances, we estimate the joint effects of traditional capital structure determinants and manager age, gender, education, business experience, sophistication, and wealth on the capital structure of single-owner corporations. By calculating the marginal contribution of personal risk tolerance, we demonstrate that owner preference contributes meaningfully to the explained variation in capital structure decisions.

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Bibliographic Info

Article provided by Pepperdine University, Graziadio School of Business and Management in its journal Journal of Entrepreneurial Finance.

Volume (Year): 14 (2010)
Issue (Month): 3 (Fall)
Pages: 1-36

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Handle: RePEc:pep:journl:v:14:y:2010:i:3:p:1-36

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Postal: 24255 Pacific Coast Hwy, Malibu CA
Web page: http://bschool.pepperdine.edu/jef
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Related research

Keywords: Capital Structure; Risk Tolerance; Owner Preference; Entrepreneurship;

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