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A theory of corporate financial structure based on the seniority of claims by Oliver D. Hart

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Published by Dept. of Economics, Massachusetts Institute of Technology in Cambridge, Mass .
Written in English


Book details:

Edition Notes

Statementby Oliver Hart and John Moore
SeriesWorking paper / Department of Economics -- no. 560, Working paper (Massachusetts Institute of Technology. Dept. of Economics) -- no. 560.
ContributionsMoore, John, 1954-, Massachusetts Institute of Technology. Dept. of Economics
The Physical Object
Pagination1 v. (various pagings) :
ID Numbers
Open LibraryOL24637270M
OCLC/WorldCa23098207

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We develop a theory of optimal capital structure based on the idea that debt and equity differ in their priority status relative to future corporate cash pants. A company with high (dispersed) debt will find it hard to raise new capital since new security-holders will have low priority relative to existing senior Cited by: A Theory of Corporate Financial Structure Based on the Seniority of Claims.. [Oliver Hart; John Moore; National Bureau of Economic Research.] -- Abstract: We develop a theory of optinal capital structure based on the idea that. Abstract: debt ath equity differ in their priority status relative to future corporate. Abstract: cash pants. A. Oliver Hart & John Moore, "A Theory of Corporate Financial Structure Based on the Seniority of Claims," STICERD - Theoretical Economics Paper Series , Suntory and Toyota International Centres for Economics and Related Disciplines, LSE. A Theory of Corporate Financial Structure Based on the Seniority of Claims. Oliver Hart and John Moore. No , NBER Working Papers from National Bureau of Economic Research, Inc Abstract: We develop a theory of optimal capital structure based on the idea that debt and equity differ in their priority status relative to future corporate cash pants. A company with high (dispersed) debt will.

Downloadable! We develop a theory of optimal capital structure based on the idea that debt and equity differ in their priority status relative to future corporate cash pants. A company with high (dispersed) debt will find it hard to raise new capital since new security-holders will . BibTeX @MISC{Hart90nbervorxing, author = {Oliver Hart and John Moore and Oliver Hart and Jthn Kdore}, title = {NBER VORXING PAPERS SERIES A THEORY OF CORPORATE FINANCIAL STRUCTURE BASED ON THE SENIORITY OF ClAIMS}, year = {}}.   The chapter concludes with a very brief mention of some empirical evidence and some suggestions for further work in the area. Chapter 8 provides a strong finish for the book. Firms, Contracts, and Financial Structure provides an excellent exposition of the incomplete contracts approach to the theory of the firm. In my view, Part I on firm. Consider an entrepreneur who needs to raise funds from an investor, but cannot commit not to withdraw his human capital from the project. The possibility of a default or quit puts an upper bound on the total future indebtedness from the entrepreneur to the investor at any date. We characterize the.

This paper provides a theory of diversification and financial structure of banks. It shows that by diversifying the bank portfolio and financing it with debt, the bank can commit to a higher level. Corporate Finance Theory. Very general meaning of CORPORATE FINANCE is “Financial activities associated with running a business” The questions which are answered by Corporate Finance are decision making about capital, finding the sources of capital, decisions regarding payment of dividend, Finance involved in Mergers and Acquisitions processes of the corporate finance companies. claims such as call options and corporate bonds. Agency Theory—analysis of the control of incentive conflicts in contractual relations. The development of a body of theory addressing these questions has evolved over time in roughly this order. Here, we briefly summarize them with emphasis on aspects central to corporate financial policy. Finance theory thus stresses fundamen-tals. It should not be deflected by account-ing allocations, except as they affect cash taxes. For example, suppose a positive-NPV project sharply reduces book earn-ings in its early stages. Finance theory would recommend .