Financial constraints and the interdependence of corporate financial decisions

Financial Constraints on Corporate Goodness ∗

An influential thesis, dubbed “Doing Well by Doing Good”, argues that corporate social responsibility is profitable. We establish that, if anything, the reverse is true: firms do good only when they do well in the sense of having financial slack. We model a firm’s optimal choices of capital and goodness subject to financial constraints. Lessconstrained firms spend more on goodness. We verify th...

Corporate Income Taxes , Financial Constraints and Innovation ∗

We examine exogenous changes in state corporate income taxes over the 1988-2006 period and find that tax decreases significantly boost both the quantity, measured by the number of patents, and the quality, measured by citations per patent, of innovative output, while tax increases have little impact on innovation. Most of the impact of tax changes on innovation occurs two or more years after th...

The Mediation Effect of Financial Leverage on the Relationship between Ownership Concentration and Financial Corporate Performance

The purpose of this paper is examining the impact of financial leverage as a mediation variable on the relationship between ownership concentration and financial corporate performance. To test the hypotheses, multiple regression analysis is used. The statistical population of this research is all listed companies in Tehran Stock Exchange. However, data were available only for 60 companies durin...

Information Asymmetry within Financial Markets and Corporate Financing Decisions

It is worth noticing that a great deal of interest has recently been paid by the financial literature with respect to the relationship prevailing between the information asymmetry and the financing decisions regarding 150 firms listed on the SBF 250 index over the period ranging from 2005 to 2012. The achieved estimation results have revealed that most variables turn out to be significantly cor...

The Financial and Non-Financial Effects of Corporate Takeovers