File Download

There are no files associated with this item.

  Links for fulltext
     (May Require Subscription)
Supplementary

Article: Production flexibility, product markets, and capital structure decisions

TitleProduction flexibility, product markets, and capital structure decisions
Authors
Issue Date2015
Citation
Review of Financial Studies, 2015 How to Cite?
AbstractWe examine how production flexibility affects financial leverage. A worldwide sample of energy utilities allows us to apply direct measures for production flexibility based on their power plants. We find that production flexibility increases financial leverage. For identification, we exploit privatizations and deregulations of electricity markets, geographical variations in natural resources, the technological evolution of gas-fired power plants, and differences in electricity prices and recapitalization cost across regions. Production flexibility affects financial leverage via the channels of reduced expected cost of financial distress and higher present value of tax shields. The relative importance of these channels depends on firms' profitability.
Persistent Identifierhttp://hdl.handle.net/10722/224893
SSRN

 

DC FieldValueLanguage
dc.contributor.authorReinartz, SJ-
dc.contributor.authorSchmid, T-
dc.date.accessioned2016-04-18T03:33:51Z-
dc.date.available2016-04-18T03:33:51Z-
dc.date.issued2015-
dc.identifier.citationReview of Financial Studies, 2015-
dc.identifier.urihttp://hdl.handle.net/10722/224893-
dc.description.abstractWe examine how production flexibility affects financial leverage. A worldwide sample of energy utilities allows us to apply direct measures for production flexibility based on their power plants. We find that production flexibility increases financial leverage. For identification, we exploit privatizations and deregulations of electricity markets, geographical variations in natural resources, the technological evolution of gas-fired power plants, and differences in electricity prices and recapitalization cost across regions. Production flexibility affects financial leverage via the channels of reduced expected cost of financial distress and higher present value of tax shields. The relative importance of these channels depends on firms' profitability.-
dc.languageeng-
dc.relation.ispartofReview of Financial Studies-
dc.titleProduction flexibility, product markets, and capital structure decisions-
dc.typeArticle-
dc.identifier.emailSchmid, T: schmid@hku.hk-
dc.identifier.authoritySchmid, T=rp02028-
dc.identifier.doi10.1093/rfs/hhv126-
dc.identifier.hkuros257570-
dc.identifier.ssrn2081902-

Export via OAI-PMH Interface in XML Formats


OR


Export to Other Non-XML Formats