{"title":"股票流动性对债务-股权选择的影响","authors":"William M. Cheung, H. Im, Bohui Zhang","doi":"10.2139/ssrn.2881170","DOIUrl":null,"url":null,"abstract":"We examine the effect of stock liquidity on a firm’s choice between debt and equity when funding its investment activities. Using decimalization regulations and Russell index reconstitutions as shocks to liquidity, we show that stock liquidity increases the firm’s propensity to raise debt capital rather than equity capital. We also find support for two economic mechanisms underlying the positive impact of stock liquidity on debt financing: a higher sensitivity of the cost of debt capital to stock liquidity than that of the cost of equity capital and an exposure to hostile takeovers. These findings provide new insights into the effect of stock liquidity on capital structure.","PeriodicalId":265477,"journal":{"name":"AsianFA Paper","volume":"29 1","pages":"0"},"PeriodicalIF":0.0000,"publicationDate":"2017-04-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"3","resultStr":"{\"title\":\"The Effect of Stock Liquidity on Debt-Equity Choices\",\"authors\":\"William M. Cheung, H. Im, Bohui Zhang\",\"doi\":\"10.2139/ssrn.2881170\",\"DOIUrl\":null,\"url\":null,\"abstract\":\"We examine the effect of stock liquidity on a firm’s choice between debt and equity when funding its investment activities. Using decimalization regulations and Russell index reconstitutions as shocks to liquidity, we show that stock liquidity increases the firm’s propensity to raise debt capital rather than equity capital. We also find support for two economic mechanisms underlying the positive impact of stock liquidity on debt financing: a higher sensitivity of the cost of debt capital to stock liquidity than that of the cost of equity capital and an exposure to hostile takeovers. These findings provide new insights into the effect of stock liquidity on capital structure.\",\"PeriodicalId\":265477,\"journal\":{\"name\":\"AsianFA Paper\",\"volume\":\"29 1\",\"pages\":\"0\"},\"PeriodicalIF\":0.0000,\"publicationDate\":\"2017-04-16\",\"publicationTypes\":\"Journal Article\",\"fieldsOfStudy\":null,\"isOpenAccess\":false,\"openAccessPdf\":\"\",\"citationCount\":\"3\",\"resultStr\":null,\"platform\":\"Semanticscholar\",\"paperid\":null,\"PeriodicalName\":\"AsianFA Paper\",\"FirstCategoryId\":\"1085\",\"ListUrlMain\":\"https://doi.org/10.2139/ssrn.2881170\",\"RegionNum\":0,\"RegionCategory\":null,\"ArticlePicture\":[],\"TitleCN\":null,\"AbstractTextCN\":null,\"PMCID\":null,\"EPubDate\":\"\",\"PubModel\":\"\",\"JCR\":\"\",\"JCRName\":\"\",\"Score\":null,\"Total\":0}","platform":"Semanticscholar","paperid":null,"PeriodicalName":"AsianFA Paper","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.2139/ssrn.2881170","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
The Effect of Stock Liquidity on Debt-Equity Choices
We examine the effect of stock liquidity on a firm’s choice between debt and equity when funding its investment activities. Using decimalization regulations and Russell index reconstitutions as shocks to liquidity, we show that stock liquidity increases the firm’s propensity to raise debt capital rather than equity capital. We also find support for two economic mechanisms underlying the positive impact of stock liquidity on debt financing: a higher sensitivity of the cost of debt capital to stock liquidity than that of the cost of equity capital and an exposure to hostile takeovers. These findings provide new insights into the effect of stock liquidity on capital structure.
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