Stakeholder Conflicts and Cash Flow Shocks: Evidence from Changes in ERISA Pension Funding Rules

• 成果类型: Article
• 署名作者: Dambra, Michael J.
• 署名单位: State University of New York (SUNY) System; University at Buffalo, SUNY
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/accr-51817
• 发表日期: 2018
• 页码: 131-159
• 关键词: financing constraints; debt holdings; INVESTMENT; earnings; plans; FIRMS; ACT; ceo; SENSITIVITIES; reversions

摘要

In 2012, Congress passed Moving Ahead for Progress in the 21st Century (MAP-21), which changed the ERISA pension funding rules such that mandatory pension contributions decreased. Advocates for the bill argued that reducing mandatory contributions would increase firms' investment. In contrast, I do not find an average increase in investment among the firms benefiting from MAP-21. Rather, I find that firms either hold pension funding relief on their balance sheets as liquid assets or pay out pension funding relief to shareholders. To the extent that managers increase investment in response to MAP-21, it is concentrated in firms with weak governance or ineffective internal controls.