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Financial Contracting and Leverage Induced Over- and Under-Investment Incentives


  • Berkovitch, Elazar
  • Kim, E Han


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  • Berkovitch, Elazar & Kim, E Han, 1990. " Financial Contracting and Leverage Induced Over- and Under-Investment Incentives," Journal of Finance, American Finance Association, vol. 45(3), pages 765-794, July.
  • Handle: RePEc:bla:jfinan:v:45:y:1990:i:3:p:765-94

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    References listed on IDEAS

    1. Stulz, ReneM., 1988. "Managerial control of voting rights : Financing policies and the market for corporate control," Journal of Financial Economics, Elsevier, vol. 20(1-2), pages 25-54, January.
    2. Shleifer, Andrei & Vishny, Robert W, 1986. "Large Shareholders and Corporate Control," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 461-488, June.
    3. Praveen Kumar, 1988. "Shareholder-Manager Conflict and the Information Content of Dividends," Review of Financial Studies, Society for Financial Studies, vol. 1(2), pages 111-136.
    4. Diamond, Douglas W, 1985. " Optimal Release of Information by Firms," Journal of Finance, American Finance Association, vol. 40(4), pages 1071-1094, September.
    5. Copeland, Thomas E & Galai, Dan, 1983. " Information Effects on the Bid-Ask Spread," Journal of Finance, American Finance Association, vol. 38(5), pages 1457-1469, December.
    6. Dybvig, Philip H & Zender, Jaime F, 1991. "Capital Structure and Dividend Irrelevance with Asymmetric Information," Review of Financial Studies, Society for Financial Studies, vol. 4(1), pages 201-219.
    7. Ofer, Aharon R & Thakor, Anjan V, 1987. " A Theory of Stock Price Responses to Alternative Corporate Cash Disbursement Methods: Stock Repurchases and Dividends," Journal of Finance, American Finance Association, vol. 42(2), pages 365-394, June.
    8. Demsetz, Harold & Lehn, Kenneth, 1985. "The Structure of Corporate Ownership: Causes and Consequences," Journal of Political Economy, University of Chicago Press, vol. 93(6), pages 1155-1177, December.
    9. Merton H. Miller & Franco Modigliani, 1961. "Dividend Policy, Growth, and the Valuation of Shares," The Journal of Business, University of Chicago Press, vol. 34, pages 411-411.
    10. Verrecchia, Robert E, 1982. "Information Acquisition in a Noisy Rational Expectations Economy," Econometrica, Econometric Society, vol. 50(6), pages 1415-1430, November.
    11. Ambarish, Ramasastry & John, Kose & Williams, Joseph, 1987. " Efficient Signalling with Dividends and Investments," Journal of Finance, American Finance Association, vol. 42(2), pages 321-343, June.
    12. Kyle, Albert S, 1985. "Continuous Auctions and Insider Trading," Econometrica, Econometric Society, vol. 53(6), pages 1315-1335, November.
    13. Ho, Thomas S. Y. & Michaely, Roni, 1988. "Information Quality and Market Efficiency," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 23(01), pages 53-70, March.
    14. Rock, Kevin, 1986. "Why new issues are underpriced," Journal of Financial Economics, Elsevier, vol. 15(1-2), pages 187-212.
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    Cited by:

    1. Dailami, Mansoor & Hauswald, Robert, 2000. "Risk shifting and long-term contracts : evidence from the Ras Gas Project," Policy Research Working Paper Series 2469, The World Bank.
    2. Saravia, Diego, 2010. "On the role and effects of IMF seniority," Journal of International Money and Finance, Elsevier, vol. 29(6), pages 1024-1044, October.
    3. Adrian Van Rixtel & Luna Romo González & Jing Yang, 2015. "The determinants of long-term debt issuance by European banks: evidence of two crises," BIS Working Papers 513, Bank for International Settlements.
    4. James S. Ang, 1992. "On the Theory of Finance for Privately Held Firms," Journal of Entrepreneurial Finance, Pepperdine University, Graziadio School of Business and Management, vol. 1(3), pages 185-203, Spring.
    5. Schuhmacher, Joachim, 1998. "Seniority Structure and Financial Intermediation," Discussion Paper Serie A 583, University of Bonn, Germany.
    6. Braouezec, Yann, 2009. "Financing constraint, over-investment and market-to-book ratio," Finance Research Letters, Elsevier, vol. 6(1), pages 13-22, March.
    7. repec:oup:rcorpf:v:6:y:2017:i:1:p:1-38. is not listed on IDEAS
    8. Mehdi Elhaei Sahar & Seyed Ali Vaez, 2013. "Information Asymmetry and Financing Decisions: Evidence from Iran Stock Exchange," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 3(3), pages 105-110, July.
    9. Barry E. Adler, 2012. "Game-Theoretic Bankruptcy Valuation," The Journal of Legal Studies, University of Chicago Press, vol. 41(1), pages 209-238.
    10. Hart, Oliver & Moore, John, 1995. "Debt and Seniority: An Analysis of the Role of Hard Claims in Constraining Management," American Economic Review, American Economic Association, vol. 85(3), pages 567-585, June.
    11. Subramanian, Krishnamurthy V. & Tung, Frederick, 2016. "Law and Project Finance," Journal of Financial Intermediation, Elsevier, vol. 25(C), pages 154-177.
    12. Sophia Rüster, 2015. "Financing LNG Projects and the Role of Long-Term Sales-and-Purchase Agreements," Discussion Papers of DIW Berlin 1441, DIW Berlin, German Institute for Economic Research.
    13. Kleimeier Stefanie & William L. Megginson, 2002. "An empirical analysis of limited recourse project finance," Research Memorandum 066, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    14. Victoria Cherkasova & Evgeniya Zakharova, 2016. "Suboptimal Investments And M&A Deals In Emerging Capital Markets," Economic Annals, Faculty of Economics, University of Belgrade, vol. 61(208), pages 93-120, January -.
    15. Bolton, Patrick & Scharfstein, David S, 1996. "Optimal Debt Structure and the Number of Creditors," Journal of Political Economy, University of Chicago Press, vol. 104(1), pages 1-25, February.
    16. Pasquale Lucio Scandizzo, 2004. "Financing Technology: An Assessment of Theory and Practice," CEIS Research Paper 43, Tor Vergata University, CEIS.
    17. Gregory E. Goering & T. Harikumar, 1999. "Investment decisions and managerial compensation design in the presence of product market rivalry," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 20(2), pages 87-97.
    18. van 't Veld, Klaas T. & Rausser, Gordon C. & Simon, Leo K., 2000. "Fitting the glass slipper: optimal capital structure in the face of liability," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt5nb497vk, Department of Agricultural & Resource Economics, UC Berkeley.
    19. Jakob Müllner, 2017. "International project finance: review and implications for international finance and international business," Management Review Quarterly, Springer;Vienna University of Economics and Business, vol. 67(2), pages 97-133, April.
    20. Größl Ingrid & Stahlecker Peter, 2000. "Finanzierungsbedingungen und Güterangebot: Ein Überblick über finanzökonomische Ansätze und deren geldpolitische Konsequenzen," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 220(2), pages 223-250, April.
    21. Stanley D. Longhofer, 1994. "Bankruptcy rules and debt contracting: on the relative efficiency of absolute priority, proportionate priority, and first-come, first-served rules," Working Paper 9415, Federal Reserve Bank of Cleveland.

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