A trade-off theory of ownership and capital structure

• 成果类型: Article
• 署名作者: Nicodano, Giovanna; Regis, Luca
• 署名单位: University of Turin; Collegio Carlo Alberto; University of Turin; University of Siena
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2018.09.001
• 发表日期: 2019
• 页码: 715-735
• 关键词: ownership; leverage; taxes; Thin capitalization; groups

摘要

This paper determines the optimal ownership share held by a unit into a second unit when both face a tax-bankruptcy trade-off. Full ownership is optimal when the first unit has positive debt, because dividends help avoid its default. Positive debt is, in turn, optimal when its corporate tax rate exceeds a threshold, and/or thin capitalization rules place an upper limit on the debt level in the second unit, and/or the Volcker Rule bans bailout transfers to the second unit. Full ownership is no longer optimal only if there is a tax on intercorporate dividend. This theory rationalizes observations on multinationals, financial conglomerates, and family groups. (C) 2018 Elsevier B.V. All rights reserved.