Back to Search
Start Over
An Empirical Test of the Impact of Managerial Self-Interest on Corporate Capital Structure.
- Source :
- Journal of Finance (Wiley-Blackwell); Jun88, Vol. 43 Issue 2, p271-281, 11p
- Publication Year :
- 1988
-
Abstract
- This paper provides a test of whether capital structure decisions are at least in part motivated by managerial self-interest. It is shown that the debt ratio is negatively related to management's shareholding, reflecting the greater nondiversifiable risk of debt to management than to public investors for maintaining a low debt ratio. Unless there is a non managerial principal stockholder, no substantial increase of debt can be realized, which may suggest that the existence of large non managerial stockholders might make the interests of managers and public investors coincide. [ABSTRACT FROM AUTHOR]
Details
- Language :
- English
- ISSN :
- 00221082
- Volume :
- 43
- Issue :
- 2
- Database :
- Complementary Index
- Journal :
- Journal of Finance (Wiley-Blackwell)
- Publication Type :
- Academic Journal
- Accession number :
- 4651759
- Full Text :
- https://doi.org/10.1111/j.1540-6261.1988.tb03938.x