Three essays on corporate debt mix, maturity structure, and inside debt compensation

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Nguyen, H. (2013). Three essays on corporate debt mix, maturity structure, and inside debt compensation. Unc Charlotte Electronic Theses And Dissertations.
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Abstract

In Chapter 1, we use a large sample of new debt to examine the determinants of corporate debt mix and to test the substitute/complement effects among debt sources. We find that both firm-level factors and macroeconomic variables are important determinants of debt mix. In addition, the set of determinants varies across time and economic conditions. In general, we find evidence for a substitution effect between public debt and private debt, both at rating downgrades and new issuance events. In Chapter 2, we examine the impacts of product market competition and corporate governance on debt maturity. We find that firms in less competitive industries use more short-term maturity than firms in more competitive industries, while firms with weak corporate governance use less short-term maturity. However, there is mixed evidence on the impact of the interaction between product market competition and corporate governance on maturity.In Chapter 3, we study the relations between inside debt compensation and corporate policies. We find a positive relationship between inside debt and leverage, indicating that CEOs with higher inside debt holdings tend to use higher leverage. We also find strong (weak) evidence on the negative relationship between inside debt and R&D activities (capital expenditures). We provide the first evidence about the relationship between inside debt and debt maturity. In one direction, short-term maturity increases in inside debt. However, in other direction, inside debt decreases in short-term maturity. Additionally, we document new evidence about the determinants of inside debt.

Details
Author

Nguyen, Hung

Title

Three essays on corporate debt mix, maturity structure, and inside debt compensation

Physical Description

1 online resource (178 pages) : PDF

Date

2013

Degree Granting Institution

University of North Carolina at Charlotte

Abstract

In Chapter 1, we use a large sample of new debt to examine the determinants of corporate debt mix and to test the substitute/complement effects among debt sources. We find that both firm-level factors and macroeconomic variables are important determinants of debt mix. In addition, the set of determinants varies across time and economic conditions. In general, we find evidence for a substitution effect between public debt and private debt, both at rating downgrades and new issuance events. In Chapter 2, we examine the impacts of product market competition and corporate governance on debt maturity. We find that firms in less competitive industries use more short-term maturity than firms in more competitive industries, while firms with weak corporate governance use less short-term maturity. However, there is mixed evidence on the impact of the interaction between product market competition and corporate governance on maturity.In Chapter 3, we study the relations between inside debt compensation and corporate policies. We find a positive relationship between inside debt and leverage, indicating that CEOs with higher inside debt holdings tend to use higher leverage. We also find strong (weak) evidence on the negative relationship between inside debt and R&D activities (capital expenditures). We provide the first evidence about the relationship between inside debt and debt maturity. In one direction, short-term maturity increases in inside debt. However, in other direction, inside debt decreases in short-term maturity. Additionally, we document new evidence about the determinants of inside debt.

Genre

doctoral dissertations

Subjects--Topics

Finance

Degree

Ph.D.

Keywords

Corporate Governance
Debt Maturity
Debt Mix
Inside Debt Compensation
Product Market Competition

Subject Area

Business Administration

Advisor(s)

King, Tao-Hsien Dolly

Committee Members

Tian, Weidong
Clark, Steven
Campbell Jr., Harrison

Degree Note

Thesis (Ph.D.)--University of North Carolina at Charlotte, 2013.

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Rights Holder Information

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Identifier

Nguyen_uncc_0694D_10536

Permalink

http://hdl.handle.net/20.500.13093/etd:1755