Purpose: In supporting APBN financing, the government always prioritizes non-debt financing. However, also uses debt financing to meet needs of state budget. One alternative efforts that must be made by Government is develop Sharia-based SBN or what can called Sukuk Negara. Method: This research a qualitative methodology. Result: Based on results has been conducted, it known State have major ro...

I propose a model of production and financing for firms in an open economy, which features financial frictions and imperfect competition in the domestic goods market. The optimal currency composition of debt comes from the motive to hedge currency exposure, which arises from the industry equilibrium in the domestic goods market. Using a panel dataset of traded Mexican firms, I find evidence tha...

This article uses a contingent-claims valuation method to compare debt financing, investment, and risk choices of a firm adopting the second-best strategy with those of a firm adopting the first-best strategy. The former bears the agency costs, as conjectured by Jensen and Meckling (1976) and Myers (1977), because it chooses suboptimal investment timing and risk levels, while the latter is able...

0378-4266/$ see front matter 2010 Published by doi:10.1016/j.jbankfin.2010.10.017 ⇑ Corresponding author at: School of Business an Integration Studies, Trinity College Dublin, College G +353 1 8961522; fax: +353 1 6799503. E-mail addresses: [email protected] (B.M. Lucey), qzha This paper investigates the impact of country-level financial integration on corporate financing choices in emerging econom...

This paper investigates the impact of asset liquidity on the valuation of corporate securities and the firm’s financing decisions. I show that asset liquidity increases debt capacity only when bond covenants restrict the disposition of assets. By contrast, I demonstrate that, with unsecured debt, greater liquidity increases credit spreads on corporate debt and reduces optimal leverage. The mode...

This paper analyzes the debt ratio and the scale of cash dividend among the internationalized and domestic electronic industries in the US from 1999 to 2008 as the reference for financing strategies and decision. The evidence shows that the debt ratio and the payout cash dividend ratio in the internationalized electronic firms are lower than those in domestic electronic firms. Due to the unique...

This paper seeks to encompass elements of both the Modigliani and Miller (1958, 1963) and Jensen and Meckling (1976) approaches to optimal capital structure within a unified framework with shadow costs of incomplete information. Making the most of the major work of Merton (1987), Leland (1996, 1998) and Bellalah (2001a), we put forward a model that reflects the interaction of financing decision...

This paper examines the association between bank debt maturity and relationship lending using a unique survey sample of 3,366 SMEs from 19 European countries. The knowledge of how the institutional environment shapes relationship lending helps us to understand how current institutional changes, such as Basel II, might affect the SME-bank relationship and hence, SME access to financing. Our resu...

The nature of the firm and its financing are closely interlinked. To produce significant net present value, an entrepreneur has to transform her enterprise into one that is differentiated from the ordinary. To achieve the control that will allow her to execute this strategy, she needs to have substantial ownership, and thus financing. But it is hard to raise finance against differentiated asset...