Transactions costs and capital structure choice: Evidence from financially distressed firms

• 成果类型: Article
• 署名作者: Gilson, SC
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.2307/2329560
• 发表日期: 1997
• 页码: 161-196
• 关键词: PUBLICLY HELD COMPANIES; empirical-analysis; BANKRUPTCY REORGANIZATION; MANAGEMENT TURNOVER; AGENCY COSTS; corporate; debt; determinants; CHAPTER-11; INVESTMENT

摘要

This study provides evidence that transactions costs discourage debt reductions by financially distressed firms when they restructure their debt out of court. As a result, these firms remain highly leveraged and one-in-three subsequently experience financial distress. Transactions costs are significantly smaller, hence leverage falls by more and there is less recurrence of financial distress,, when firms recontract in Chapter 11. Chapter 11 therefore gives financially distressed firms more flexibility to choose optimal capital structures.