search query: @freeterm leverage / total: 7
reference: 6 / 7
| Author: | Wald, J.K. Long, M.S. |
| Title: | The effect of state laws on capital structure |
| Journal: | Journal of Financial Economics
2007 : FEB, VOL. 83:2, p. 297-319 |
| Index terms: | USA law profitability |
| Freeterms: | capital structure leverage |
| Language: | eng |
| Abstract: | U.S. manufacturing firms incorporated in states with stronger payout restrictions use less debt, whereas antitakeover laws (here as: a-laws) do not significantly reduce long-run leverage. It is found that firms sort themselves according to state laws and capital structure needs. After accounting for self-selection, state a-laws are positively associated with debt as a fraction of market value, possibly due to lower market values for these firms. The constraints explain part of the negative relation btw. leverage and profitability. |
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