Measuring investment distortions arising from stockholder-bondholder conflicts

• 成果类型: Article
• 署名作者: Parrino, R; Weisbach, MS
• 署名单位: University of Texas System; University of Texas Austin; University of Illinois System; University of Illinois Urbana-Champaign
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/S0304-405X(99)00015-X
• 发表日期: 1999
• 页码: 3-42
• 关键词: capital structure; stockholder-bondholder conflicts; Underinvestment; asset substitution; Monte-Carlo simulations

摘要

We examine the importance of stockholder-bondholder conflicts in capital-structure choice. Numerical techniques are used to compute the expected wealth transfer between stockholders and bondholders when a firm adopts a new project. We characterize the set of positive NPV projects that stockholders prefer to ignore and the set of negative NPV projects that stockholders want to accept. The results illustrate how these distortions vary with firm and project characteristics. We also estimate the impact of stockholder-bondholder conflicts on investment decisions for 23 different firms and examine the extent to which stockholder-bondholder conflicts explain observed cross-sectional variation in capital structures. (C) 1999 Elsevier Science S.A. All rights reserved.