Financial Flexibility and Capital Structure Decision

Byoun, Soku

doi:10.2139/ssrn.1108850

Cited by 88 publications

(85 citation statements)

References 33 publications

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“…Further empirical prior also show that firms above target levels are quicker to adjust to target levels relative to firms below target levels due to the relatively costlier position [4,5,6] Our purpose of investigating the impact of intrinsic limitations on moment adjustment and distance reduction is well motivated by the literature [7,8,9]. Our study looks at the velocity of moment adjustment based on the intrinsic limitations of financial constraints which is a known intrinsic limitation to impact financial issuing decisions among managers [ 10, 11, 12, 13, 14, and 15].…”

Section: Review Of the Literature And Motivating The Studymentioning

confidence: 99%

Speed of Adjustment and Financial Constraints: Evidence from the UK

Hussain¹,

Shamsudin²,

Jabarullah³

et al. 2016

Indian Journal of Science and Technology

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Abstract. Our paper estimates the speed of moment adjustment based on the first difference of the lead (t+1) leverage levels (actual lead) and lag (t-1) leverage levels (actual lag) to the first difference of simulated lead (target) leverage levels and lag levels (actual lag leverage) for firm level data. We introduce an intrinsic limitation (financial constraints) to the model to test the impact on speed of adjustment and distance reduction. We find that financial constraints have a statistically and economically significant impact on rate of adjustment and distance reduction to target leverage levels.

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Section: Review Of the Literature And Motivating The Studymentioning

confidence: 99%

Speed of Adjustment and Financial Constraints: Evidence from the UK

Hussain¹,

Shamsudin²,

Jabarullah³

et al. 2016

Indian Journal of Science and Technology

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“…Végül pedig Byoun (2011) tételét szeretném az adatbázis vállalataira megvizsgálni. A tétel szerint a tőkeáttétel és a pénzügyi flexibilitásra való igény között negatív -U alakú kapcsolat van.…”

Section: áBra: Hosszú Lejáratú Kötelezettségek Arányának áTlaga Az Egunclassified

The Impact of Flexibility on the Capital Structure

Czelleng¹

2013

E-conom

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“…The financial flexibility is the affordance of companies for providing the financial recourses to have a proper reaction in the unexpected cases and events to maximize the company value [1]. Heath (1978) explains the financial flexibility as the power of corrective action for removing the cash paid being excess of the anticipated cash received with minimum effects on the present and future income or the market value of the company stock [2].…”

Section: Introductionmentioning

confidence: 99%

The Effect of Financial Flexibility on Financial Behavior of Companies Listed in Tehran Stock Exchange

Mirkhalili¹,

Mahmoudabadi²

2018

AJIBM

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The flexibility plays an important role in making the managers powerful in the regard of investment in the future. The problems of the capital market have necessitated the maintenance of flexibility for the companies for the purpose of using profitable opportunities. The present research has aimed to study the effect of financial flexibility on the financial behavior. The statistic sample used in the present study consists of 100 companies accepted in Tehran stock exchange during the years 2009 to 2015. The financial flexibility and financial behavior are respectively the independent and dependent variables which were measured by the investment activity, dividend payout ratio, amount of cash holding and company value. The data analysis was done by the use of the multi-variable regression models based on the panel data techniques and the use of Eviews econometrics software. The results concluded from the study of effect of the financial flexibility on the financial behavior corresponding to the theoretical foundations which had meaningful and positive effects. Therefore, the hypothesis that the financial flexibility has positive and meaningful effects on the investment activity of the companies accepted in the stock exchange was confirmed. The other results of paper were that the financial flexibility had negative and meaningful effects on the dividend payout ratio. So, the hypothesis that the financial flexibility has negative and meaningful effects on the dividend payout ratio of the companies accepted in the stock exchange was not confirmed. The hypothesis that the financial flexibility has positive and meaningful effects on the amount of cash holding of the companies accepted in the stock exchange was not confirmed, because the effect of the flexibility on the amount of cash holding was not meaningful. Also, the hypothesis that the financial flexibility has positive and meaningful effects on the value of companies accepted in the

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Financial Flexibility and Capital Structure Decision

Cited by 88 publications

References 33 publications

Speed of Adjustment and Financial Constraints: Evidence from the UK

Speed of Adjustment and Financial Constraints: Evidence from the UK

The Impact of Flexibility on the Capital Structure

The Effect of Financial Flexibility on Financial Behavior of Companies Listed in Tehran Stock Exchange

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